mmmik 


Wo     U  II  J'  b  fi  u 


INSURANCE  LAW 


3- 


INSURANCE  LAWS 


CALIFORNIA 

18  7  4. 


INSURANCE  LAWS 


OF   THE 


State    of     Paltfornia, 


A    COMPILATION    OF   THE    STATUTES    OF    THE    STATE    AND    THE    ORDI- 
NANCES   OF    THE  CITY    OF   SAN    FRANCISCO,    RELATING    TO    IN- 
SURANCE   CORPORATIONS    AND   THEIR   BUSINESS  IN   THIS 
STATE,  IN  FORCE  AT  THE    DATE  HEREOF. 


Compiled  under  the  supervision  ol 

J.  W.    FOARD;   Insurance   Commissioner, 
San  Francisco,  Cal.,  July  15th,  1874. 


SAN  FRANCISCO : 

Bacon  &  Company,  Printers,  Corner  Clay  and  Sansome  Streets. 

1874. 


rr-fr 


Pfefkce. 


This  compilation  of  the  Statutes  of  California  and  Ordi- 
nances of  the  City  of  San  Francisco,  relating  to  Insurance 
Corporations  and  their  business  in  this  State,  is  intended  as  a 
summary  of  the  laws  in  force  at  the  date  hereof,  touching 
such  matters  ;  the  several  amendments  and  additions  made  at 
the  last  session  of  the  Legislature  being  placed  in  their  regu- 
lar order,  following  the  amended  Sections  respectively,  as 
shown  in  the  original  Codes. 

In  Sections  3607  to  3896  of  the  Political  Code,  the  Leg- 
islature has  devised  a  comprehensive  revenue  scheme ;  and 
as  no  mention  is  made  therein  of  "tax  on  premiums,"  or 
"  stamp  duties,"  those  taxes,  as  existing  at  the  date  of  the 
passage  of  the  Code — March  12th,  1872 — must  be  consid- 
ered to  have  been  abrogated  by  Section  18  of  said  Code,  as 
shown  at  page  21  of  this  volume  :  thus  leaving  the  business 
of  Insurance  entirely  free  from  taxation,  in  so  far  as  State 
laws  are  concerned. 

The  attention  of  parties  interested  is  directed  to  "  An  Act 
in  relation  to  Foreign  Corporations,"  at  page  53. 

The    amendments  and  additions   made   to  the  Insurance 


PREFACE. 


Laws,  at  the  last  session  of  our  Legislature,  will  be  found  as 
follows : 


Sec.  419 
427 
428 
441 
444 


CIVIL    CODE. 

Page. 


Sec.  447 
448 
449 
450 
451 


Page. 
.  18 
. .  19 
.  .  19 
.  .  19 
.  .  20 


POLITICAL    CODE. 


Sec.  116 
117 
118 
337 
595 
596 
G02 


Page. 
.  .  50 
.  .  51 
.  .  51 
.  .  22 
.  .  25 
.  .  26 
. .  30 


Page. 

Sec.  610 ..../...  34 

611 35 

616 42 

617 43 

622 47 

633 50 


The  Civil  Code 


OF   THE 


STATE  OF  CALIFORNIA. 


AN  ACT  TO  ESTABLISH  A  CIVIL  CODE. 

Approved  March  21st,  1872. 


TITLE  OF  THE  ACT. 

Section  1.     This  Act  shall  be   known  as  The  Civil  two  and 

Divisions  oi 

Code  op  the  State  of  California,    *    *    *  twsAct. 

Sec.  2.     This  Code  takes  effect  at  twelve  o'clock  noon,  on  J™011*^3 

7  Code  takes 

the  first  day  of  January,  eighteen  hundred  and  seventy-three.   effeet 
Sec.  3.     No  part  of  it  is  retroactive,  unless  expressly  so  Not 

L  **._■■*  retroactive. 

declared. 


Sec.  4.  The  rule  of  the  common  law  that  statutes  in  de- 
rogation thereof  are  to  be  strictly  construed,  has  no  applica- 
tion to  this  Code.  The  Code  establishes  the  law  of  this  State 
respecting  the  subjects  to  which  it  relates,  and  its  provisions 
are  to  be  liberally  construed  with  a  view  to  effect  its  objects 
and  to  promote  justice. 


Rules  of 
construction' 


CIVIL   CODE. 


Provisions 
similar  to 
existing 
laws,  how 
construed. 


Sec.  5.  The  provisions  of  this  Code,  so  far  as  they  are 
substantially  the  same  as  existing  statutes  or  the  common  law, 
must  be  construed  as  continuations  thereof,  and  not  as  new 
enactments. 


Actions,  etc. , 
not  affected. 


Sec.  6.  No  action  or  proceeding  commenced  before  this 
Code  takes  effect,  and  no  right  accrued,  is  affected  by  its 
provisions. 


Effect  of 
repeal. 


This  Act, 
how  cited. 


Sec.  20.  No  statute,  law,  or  rule  is  continued  in  force 
because  it  is  consistent  with  the  provisions  of  this  Code  on 
the  same  subject ;  but  in  all  cases  provided  for  by  this  Code, 
all  statutes,  laws,  and  rules  heretofore  in  force  in  this  State, 
whether  consistent  or  not  with  the  provisions  of  this  Code,  un- 
less expressly  continued  in  force  by  it,  are  repealed  or  abro- 
gated. 

Sec.  21.  This  Act  whenever  cited,  enumerated,  referred 
to,  or  amended,  may  be  designated  simply  as  "  The  Civil 
Code,"  adding,  when  necessary,  the  number  of  the  section. 


PART   IV. 

TITLE  II. 

INSURANCE    CORPORATIONS. 


Chapter  I.      General  Provisions. 

II.     Fire  and  Marine  Insurance  Corporations. 
III.     Mutual  Life,  Health,  and  Accident  Insurance 
Corporations. 


Section  414. 
415. 
416. 
41*7. 
418. 
419. 


CHAPTER    I. 

.       GENERAL   PROVISIONS. 

Subscriptions  to  capital  stock  opened,  and  how  collected. 

Purchase  and  conveyance  of  real  estate. 

Policies,  how  issued  and  by  whom  signed. 

Dividends,  of  what  and  when  declared. 

Directors  liable  for  loss  on  insurance  in  certain  cases. 

Capital  to  be  at  least  one  hundred  thousand  dollars. 


opened,  and 
how  collect- 
ed. 


Section  414.     After  the  Secretary  of  State  issues  the  satwcrfp-  . 

•/  tions  to  capi 

certificate  of  incorporation,  as  provided  in  Article  I,  Chapter  t! 
I,  Title  I,  of  this  Part,  the  Directors  named  in  the  articles 
of  incorporation  must  proceed  in  the  manner  specified,  or  in 
their  by-laws,  or  if  none,  then  in  such  manner  as  they  may 
by  order  adopt,  to  open  books  of  subscription  to  the  capital 
stock  then  unsubscribed,  and  to  secure  subscriptions  to  the 
full  amount  of  the  fixed  capital ;  to  levy  assessments  and  in- 
stallments thereon,  and  to  collect  the  same,  as  in  Chapter  II 
of  Title  I  provided. 


CIVIL   CODE. 


Purchase 
and  convey- 
ance of  real 
estate. 


Policies, 
how  issued 
and  by 

whom 
signed. 


Dividends, 
of  what 
and  when 
declared. 


Sec.  415.  No  insurance  corporation  must  purchase,  hold, 
or  convey  real  estate,  except  as  hereinafter  set  forth,  to  wit : 

1.  Such  as  is  requisite  for  its  accommodation  in  the 
convenient  transaction  of  its  business,  not  exceeding  in  value 
one  hundred  and  fifty  thousand  dollars ; 

2.  Such  as  is  conveyed  to  it,  or  to  any  person  for  it, 
by  way  of  mortgage  or  in  trust,  or  otherwise,  to  secure  or 
provide  for  the  payment  of  loans  previously  contracted,  or  for 
moneys  due ; 

3.  Such  as  is  purchased  at  sales  upon  deeds  of  trust 
or  judgments  obtained  or  made  for  such  loans  or  debts  ; 

4.  Such  as  is  conveyed  to  it  in  satisfaction  of  debts 
previously  contracted  in  the  course  of  its  dealings. 

All  such  real  estate  so  acquired,  which  is  not  requisite  for 
the  accommodation  of  such  corporation  in  the  transaction  of 
its  business,  must  be  sold  and  disposed  of  within  five  years 
after  such  corporation  acquired  title  to  the  same.  No  such 
real  estate  must  be  held  for  a  longer  period  than  five  years, 
unless  the  corporation  first  procures  a  certificate  from  the  In- 
surance Commissioner  that  the  interest  of  the  corporation 
will  suffer  materially  by  a  forced  sale  of  such  real  estate,  in 
which  event  the  time  for  the  sale  may  be  extended  to  such 
time  as  the  Insurance  Commissioner  directs  in  the  certificate. 

Sec  416.  All  policies  made  by  insurance  corporations 
must  be  subscribed  by  the  President  or  Vice-President,  or  in 
case  of  the  death,  absence,  or  disability  of  those  officers,  by 
any  two  of  the  Directors,  and  countersigned  by  the  Secretary 
of  the  corporation.  All  such  policies  are  as  binding  and  ob- 
ligatory upon  the  corporation  as  if  executed  over  the  corpo- 
rate seal. 

Sec.  417.  The  directors  of  every  insurance  corporation, 
at  such  times  as  their  by-laws  provide,  must  make,  declare, 
and  pay  to  the  stockholders  dividends  of  so  much  of  the  net 
profits  of  the  corporate  business  and  interest  on  capital  in- 
vested as  to  them  appears  advisable ;  but  the  moneys  re- 
ceived and  notes  taken  for  premium  on  risks  which  are  un- 


GENERAL   PROVISIONS. 

determined  and  outstanding  at  the  time  of  making  the  divi- 
dend must  not  be  treated  as  profits,  nor  divided,  except  as 
provided  in  Chapter  II  of  this  title. 

Sec.  418.     If  any   insurance   corporation  is  under  liabili-  SwS 
ties  for  losses  to   any  amount  equal,  to  its  capital  stock,  and  iSturance 

in  ccrtnin 

the  President  or  Directors,  after  knowing  the  same,  make  any  cases. 
new  or  further  insurance,  the  estates  of  all  who  make  such 
insurance,  or  assent  thereto,  are  severally  and  jointly  liable 
for  the  amount  of  any  loss  which  takes  place  under  such  in- 
surance. 

Sec.  419.  No  company,  corporation,  or  association  shall  f^JJ 
hereafter  be  formed  or  organized  under  the  laws  of  this  State  ffSrecf 
for  the  transaction  of  business  in  any  kind  of  insurance,  ex-  dollars. 
cept  on  live  stock,  without  a  subscribed  capital  equal  at  least 
to  one  hundred  thousand  dollars  in  United  States  gold  coin, 
twenty-five  per  cent,  whereof  must  be  paid  in  previous  to  the 
issue  of  any  policy,  and  the  remainder  by  monthly  or  quar- 
terly installments  within  twelve  months  from  the  day  of  filing 
the  certificate  of  incorporation.  Nor  must  any  individual  or 
person  be  permitted  to  transact  business  as  agent  of  any  non- 
resident person  or  corporation,  whether  foreign  or  domestic, 
in  any  kind  of  insurance,  except  on  live  stock,  unless  such 
person  or  corporation  possesses  available  cash  assets,  exclu- 
sive of  stock  notes,  to  the  amount  of  at  least  one  hundred 
thousand  dollars  in  United  States  gold  coin,  over  and  above 
all  liabilities. 

[Amended.] 

Section  1.     Section  419   of  the  Civil   Code  is   hereby 
amended  so  as  to  read  as  follows  : 

Sec.  419.  No  company,  corporation,  or  association,  ex-  J"pitraTce 
cept  mutual  life,  health,  and  accident  corporations,  shall  here- 
after be  formed  or  organized,  under  the  laws  of  this  State,  for 
the  transaction  of  business  in  any  kind  of  insurance,  except  on 
live  stock,  without  a  subscribed  capital  equal  to  at  least  two 
hundred  thousand  dollars  in  United  States  gold  coin  ;  twenty- 
five  per  cent.,  whereof  must  be  paid  in  previous  to  the  issuance 


10 


CIVIL   CODE. 


of  any  policy,  and  the  residue  by  monthly  or  quarterly  install- 
ments, within  twelve  months  from  the  day  of  filing  the  certifi- 
cate of  incorporation.  No  individual,  or  person,  or  corpora- 
tion, organized  under  the  laws  of  any  other  State  or  country 
as  a  stock  company,  must  transact  any  kind  of  insurance  busi- 
ness in  this  State,  except  on  live  stock,  unless  such  person  or 
corporation  has  a  paid  up  capital  stock  equal  to  at  least  two 
hundred  thousand  dollars  in  United  States  gold  coin,  and  has 
available  cash  assets,  exclusive  of  stock  notes,  equal  to  two 
hundred  thousand  dollars  in  such  gold  coin  over  and  above  all 
liabilities  for  losses  reported,  expenses,  taxes,  and  reinsurance 
of  all  outstanding  risks,  as  provided  in  Section  602  of  the 
Political  Code  of  this  State.  Nor  must  any  individual  or 
person,  as  agent  of  any  person  or  corporation,  organized 
under  the  laws  of  any  other  State  or  country  as  a  mutual 
insurance  company,  transact  any  kind  of  insurance  business 
in  this  State,  except  on  live  stock,  unless  such  person  or  cor- 
poration possess  available  cash  assets  equal  to  at  least  two 
hundred  thousand  dollars  in  United  States  gold  coin,  over 
and  above  all  liabilities  for  losses  reported,  expenses,  taxes, 
and  reinsurance  of  all  outstanding  risks,  as  provided  in  Sec- 
tion 602  of  the  Political  Code  of  this  State. 
Approved  March  30th,  1874. 


CHAPTER    IT. 


EIRE   AND   MARINE    INSURANCE   CORPORATIONS. 


Payment 
of  subscrip- 
tions.   Capi- 
tal to  be  all 
paid  in 
twelve 
months. 


Section  424.     Payment  of  subscriptions.     Capital  to  be  all  paid  in  twelve 
months, 

425.  Certificate  of  capital  stock  paid  up  to  be  filed,  and  when. 

426.  Property  which  may  be  insured. 
42V.     Funds  may  be  invested,  how. 

428.  Rate  of  risk. 

429.  Amounts  to  be  reserved  before  making  dividends. 

430.  Amounts  to  be  reserved   by  companies  with  less  than  two 

hundred  thousand  dollars  capital. 

Sec.  424.  The  entire  capital  stock  of  every  fire  or 
marine  insurance  corporation  must  be  paid  up  in  cash 
within  twelve  months  from  the  filing  of  the  articles  of 
incorporation y  and  no  policy  of  insurance  must  be  issued  or 


FIRE   AND    MARINE    INSURANCE    CORPORATIONS.  11 

risk  taken  until  twenty-five  per  cent  of  the  whole  capital 
stock  is  paid  up. 

Sec.  425.     The  President  and  a  majority  of  the  Directors  Jjf^jjga 
must,  within  thirty  days  after  the  payment  of  the  twenty-five  u^SST1 
per  cent,  of  the  capital  stock,  and  also  within  thirty  days  after  when. 
the  payment  of  the  last  installment  or   assessment  of  the 
capital  stock  limited  and  fixed,  prepare,  subscribe,  and  swear 
to  a  certificate  setting  forth  the  amount  of  the  fixed  capital, 
and  the  amount  thereof  paid  up  at  the  times  respectively  in  this 
section  named,  and  file   the  same  in  the  office  of  the  County 
Clerk  of  the  county  where  the  principal  place  of  business  of 
the  corporation  is  located,  and  a  duplicate  thereof,  similarly 
executed,  with  the  Insurance  Commissioner. 

Sec  426.     Every  corporation  formed  for  fire  or  marine  property 

ii  i  •  i  i       •         which  may 

insurance,  or  both,  may  make  insurance  on  all  insurable  in-  be  insured, 
terests  within  the  scope  of  its  articles  of  incorporation,  and 
may  cause  itself  to  be  reinsured. 

Sec  427.     Every  fire  and  marine  insurance  corporation  Funds  may 

-r»  i  t-v  ill  •  be  investe(1* 

may,  by  its  Board  of  Directors  or  as  the  by-laws  direct,  invest  h°w- 
its  funds  in  loans  upon  real   or  personal  property,  or   in 
the  purchase  of  stocks,  bonds,  or  other  securities,  but  no  loan 
must  be  made  on  the  stock  of  the  corporation  as  security. 

[Amended.] 

Sec  81.     Section  427  of  said  Code  is  amended  to  read 
as  follows : 

Sec  427.  Every  fire  and  marine  insurance  corporation  same. 
may,  by  its  Board  of  Directors,  or  as  the  by-laws  direct,  in- 
vest its  funds  in  loans  upon  real  or  personal  property,  or  in 
the  purchase  of  stocks,  bonds,  or  other  securities,  but  no  loan 
must  be  made  on  the  stock  of  the  corporation,  or  on  the  notes 
or  obligations  of  any  of  its  stockholders. 

Approved  March  30th,  1874. 

Sec  428.     Fire  and  marine  insurance  corporations,  or  JJateof 
either,  must  never  take  on  any  one  risk,  whether  it  is  a  marine 
insurance  or  an  insurance  against  fire,  a  sum  exceeding  one 
tenth  part  of  their  capital  actually  paid  in,  without  reinsuring 
the  excess  above  one  tenth. 


CIVIL   CODE. 


Insurance, 
limit  of  one 
risk. 


Amounts  to 
be  reserved 
before  mak- 
ing divi- 
dends. 


[Amended.] 

Sec.  81|.  Section  428  of  said  Code  is  amended  to  read 
as  follows : 

Sec.  428.  Fire  and  marine  insurance  corporations  must 
never  take  on  any  one  risk,  whether  it  is  a  marine  insurance 
or  an  insurance  against  fire,  a  sum  exceeding  one  tenth  part 
of  their  capital  actually  paid  in,  and  intact  at  the  time  of 
taking  such  risk,  without  reinsuring  the  excess  above  one 
tenth. 

Approved  March  30th,  1874. 

Sec.  429.  No  corporation  transacting  fire  or  marine  in- 
surance business  under  the  laws  of  this  State,  must  make  any 
dividends,  except  from  profits  remaining  on  hand  after  retain^ 
ing  unimpaired : 

1.  The  entire  subscribed  capital  stock ; 

2.  All  the  premiums  received  or  receivable  on  out- 
standing marine  or  inland  risks,  except  marine  time  risks ; 

3.  A  fund  equal  to  one  half  of  the  amount  of  all  pre- 
miums on  fire  risks  and  marine  time  risks  not  terminated  at 
the  time  of  making  such  dividend  ; 

4.  A  sum  sufficient  to  pay  all  losses  reported  or  in 
course  of  settlement,  and  all  liabilities  for  expenses  and  taxes. 


Amounts  to 
be  reserved 
by  compan- 
ies with  less 
than  two 
hundred 
thousand 
dollars 
capital. 


Sec.  430.  No  fire  or  marine  insurance  corporation,  with 
a  subscribed  capital  of  less  than  two  hundred  thousand  dollars, 
must  declare  any  dividends,  except  from  profits  remaining  on 
hand  after  reserving : 

1.  A  sum  necessary  to  form,  with  the  subscribed  capital 
stock,  the  aggregate  sum  of  two  hundred  thousand  dollars  ; 

2.  All  the  premiums  received  or  receivable  on  out- 
standing marine  or  inland  risks,  except  marine  time  risks ; 

3.  A  fund  equal  to  one  half  the  amount  of  all  pre- 
miums on  fire  risks  and  marine  time  risks  not  terminated  at 
the  time  of  making  such  dividend  ; 

4.  A  sum  sufficient  to  pay  all  losses  reported  or  in 
course  of  settlement,  and  all  liabilities  for  expenses  and  taxes. 


INSURANCE   CORPORATIONS.  13 

CHAPTER    III. 

MUTUAL    LIFE,    HEALTH,    AND    ACCIDENT    INSURANCE    CORPORATIONS. 

Section  437.  Capital  Stock.     Guarantee  Fund. 

438.  Of  what  Guarantee  Fund  shall  consist. 

439.  What  constitutes,  and  deficiency  in  fixed  capital. 

440.  Declaration  of  fixed  capital  to  be  filed. 

441.  Guarantee  notes  and  interest,  how  disposed  of. 

442.  Insured  to  be  entitled  to  vote,  when. 

443.  Number  of  directors  may  be  altered,  how. 

444.  May  invest  in  what  securities. 

445.  Limitations  to  the  holding  of  stock  and  in  other  particulars 

may  be  provided  for  in  by  laws. 

446.  Premiums,  how  payable. 

447.  Corporations  to  furnish  Insurance  Commissioner  with  valu- 

ation of  policies  outstanding,  when.     How  estimated. 

448.  No  stamp  required  on  accident  insurance  contract. 

449.  Retaliatory  clause. 

450.  Policies  issued  within  this  State  to  contain  notice  that  they 

were  so  issued. 

451.  Cancellation  and  payment. 

Sec.  437.     Every  corporation  formed  for  the  purpose  of  Slal 
mutual  insurance  on  the  lives  or  health  of  persons,  or  against 
accidents  to  persons  for  life  or  any  fixed  period  of  time,  or  . 
to  purchase  and  sell  annuities,  must  have  a  capital  stock  of 
not  less  than  one  hundred  thousand  dollars.     It  must  not 
make  any  insurance  upon  any  risk  or  transact  any  other  business 
as  a  corporation  until  its  capital  stock  is  fully  paid  up  in  cash, 
nor  until  it  has  also  obtained  a  Fund,  to  be  known  as  a 
"Guarantee  Fund,"  of  not  less  than  two  hundred  and  fifty  iSi*1^* 
thousand  dollars,  as  is  hereinafter  provided.     If  more  than 
the  requisite  amount  is  subscribed,  the  stock  must  be  dis- 
tributed pro  rata  among  the  subscribers.     Any  subscription 
may  be  rejected  by  the  Board  of  Directors  or  the  committee 
thereof,  either  as  to  the  whole  or  any  part  thereof,  and  must 
be,  so  far  as  rejected,  without  effect. 

Sec  438.     The  Guarantee  Fund  mentioned  in  the  pre-  Guarantee 
ceding  section  must  consist  of  the  promissory  notes  of  solvent  consist, 
parties,  approved  by  the  Board  of  Directors  and  by  each 
other,  payable  to  the  corporation  or  its  order,  and  at  such 
times,  in  such  modes,  and  in  such  sums,  with  or  without  in- 


14  CIVIL   CODE. 

terest,  and  conformable  in  all  other  respects  to  such  require- 
ments as  the  Board  of  Directors  prescribe  ;  but  the  amount 
of  the  notes  given  by  any  one  person  must  not  exceed  in  the 
whole  the  sum  of  five  thousand  dollars,  exclusive  of  interest. 
Such  notes  must  be  payable  absolutely  and  at  the  option  of 
the  corporation  ;  they  must  be  negotiable,  and  may  be  in- 
dorsed and  transferred,  or  converted  into  cash,  or  otherwise 
dealt  with  by  the  corporation,  at  its  discretion,without  reference 
to  any  contingency  of  losses  or  expenses.  Such  notes,  or  the 
proceeds  thereof,  must  remain  with  the  corporation  as  a  fund 
for  the  better  security  of  persons  dealing  with  it,  and  con- 
stitute the  assets  of  the  corporation,  liable  for  all  its  debts, 
obligations,  and  indebtedness,  next  after  its  assets  from  pre- 
miums and  other  sources,  exclusive  of  capital  stock,  until  the 
net  earnings,  over  and  above  its  expenses,  losses,  and 
liabilities,  shall  have  accumulated  in  cash,  or  securities  in 
which  the  net  earnings  have  been  invested,  to  a  sum  which, 
with  the  capital  stock,  is  equal  to  the  aggregate  of  the 
original  amounts  of  the  Guarantee  Fund  and  of  the  capital 
stock. 

tuSamfde-  Sec.  439.  The  sum  accumulated  as  provided  in  the  pre- 
flxe^capuai.  ceding  section,  together  with  the  capital  stock,  shall  become 
and  remain  the  fixed  capital  of  the  corporation,  not  subject 
to  division  among  the  stockholders  or  parties  dealing  with  it, 
or  to  be  expended  in  any  manner  otherwise  than  may  be 
required  in  payment  of  the  corporation's  debts  and  actual 
expenses,  until  the  business  of  the  corporation  is  closed, 
its  debts  paid,  and  its  outstanding  policies  and  obligations 
of  every  kind  cancelled  or  provided  for ;  and  if  from  any 
cause  a  deficiency  at  any  time  occurs  in  such  fixed  capital, 
no  further  division  of  profits  must  take  place  until  such 
deficiency  has  been  made  up. 


Declaration 
of  fixed  cap 


Sec.  440.     Whenever  the  fixed  capital  of  the  corpora- 
meV.0  be        tion  is  obtained  as  hereinbefore  provided,  the  President  of 
the  corporation  and  its  Actuary,  or  its  Secretary,  if  there 


INSURANCE   CORPORATIONS.  15 

is  no  Actuary,  must  make  a  declaration  in  writing,  sworn 
to  before  some  Notary  Public,  of  the  amount  of  such  fixed 
capital,  and  of  the  particular  kinds  of  property  composing 
the  same,  with  the  nature  and  amount  of  each  kind,  which 
must  be  filed  with  the  original  articles  of  incorporation, 
and  a  copy,  certified  by  the  County  Clerk,  must  be  pub- 
lished for  at  least  four  successive  weeks  in  a  newspaper  pub- 
lished in  the  county  where  the  principal  business  of  the 
corporation  is  situated.  Upon  the  filing  of  such  declara- 
tion the  Guarantee  Fund  is  discharged  of  its  obligations, 
and  all  notes  of  the  Fund  remaining  in  the  control  of  the 
corporation,  and  not  affected  by  any  lien  thereon,  or  claim  of 
that  nature,  must  be  surrendered  by  it  to  the  makers 
thereof,  respectively,  or  other  parties  entitled  to  receive  the 
same. 

Sec.  441.     Until  the  Guarantee  Fund  is  discharged  from  Guarantee 
its  obligations,  as  provided  in  the  preceding  section,  no  note  SuereJnhow 

°  '  r  V  disposed  of. 

must  be  drawn  from  the  Fund,  unless  another  note  of  equal 
solvency  is  substituted  therefor,  with  the  unanimous  ap- 
proval of  the  Board  of  Directors  then  in  office,  and  of  all 
other  parties  liable  on  the  rest  of  the  notes  comprising  the 
Guarantee  Fund.  The  corporation  must  allow  a  commis- 
sion of  five  per  cent,  per  annum  on  all  such  guarantee  notes 
while  outstanding,  and  also  interest  on  all  moneys  paid  on 
such  notes  by  the  parties  liable  thereon,  at  the  rate  of 
twelve  per  cent,  per  annum,  payable  half  yearly  until  re- 
paid by  the  corporation.  But  such  rate  of  interest  may, 
from  time  to  time,  at  intervals  of  not  less  than  one  year, 
be  increased  or  reduced  by  the  Board  of  Directors,  so  as 
to  conform  to  the  then  current  rates  of  interest. 


[Amended.] 

Sec.  82.  Section  441  of  said  Code  is  amended  to  read 
as  follows : 

Sec.  441.  Until  the  Guarantee  Fund  is  discharged  from 
its  obligations,  as  provided  in  the  preceding  section,  no  note 
must  be  withdrawn  from  the  Fund,  unless  another  note  of 


Same. 


D  CIVIL   CODE. 

equal  solvency  is  substituted  therefor,  with  the  approval  of  the 
Board  of  Directors.  The  corporation  must  allow  a  commis- 
sion, not  exceeding  five  per  cent,  per  annum,  on  all  such  guar- 
antee notes  while  outstanding,  and  also  interest  on  all  moneys 
paid  on  such  notes  by  the  parties  liable  thereon,  at  the  rate 
of  twelve  per  cent,  per  annum,  payable  half  yearly,  until  re- 
paid by  the  corporation,  unless  the  current  rate  of  interest  is 
different  from  this  amount,  in  which  case  the  rate  payable 
may,  from  time  to  time,  at  intervals  of  not  less  than  one  year, 
be  increased  or  reduced  by  the  Board  of  Directors,  so  as  to 
conform  to  the  current  rate. 
Approved  March  30th,  1874. 

Kntuild  Sec.  442.  After  the  filing  of  the  declaration  of  the  fixed 
when6'  capital,  as  in  this  article  provided,  the  holders  of  policies 
of  life  insurance  for  the  term  of  life,  on  which  the  pre- 
miums are  not  in  default,  may  vote  at  the  election  of 
Directors,  and  have  one  vote  for  each  one  thousand  dollars 
insured  by  their  policies,  respectively. 


Number  of.       Sec.  443.     The  number    of    Directors    specified  in  the 

Directors  L 

teredbhow.  articles  of  incorporation  may  be  altered  from  time  to  time 
during  the  existence  of  the  corporation  by  resolution,  at 
the  annual  meeting  of  a  majority  of  those  entitled  to  vote 
at  the  election  of  Directors,  but  the  number  must  never  be 
reduced  below  five. 


in  what  se- 
curities, 


May^invest         Sec.  444.     Life,  health,  and  accident  insurance  corpora- 
tions may  invest  their  capital  stock  as  follows: 

1.  In  loans  upon  unincumbered  and  improved  real 
estate  within  the  State  of  California,  which  shall  be  worth 
at  the  time  of  the  investment  at  least  fifty  per  cent,  more  than 
the  sum  loaned ; 

2.  In  the  purchase  of  or  loans  upon  interest-bearing 
stocks,  bonds,  and  other  securities  of  the  United  States, 
and  of  the  States  thereof; 

3.  In  the  purchase  of  or  loans  upon  interest-bearing 
bonds  of  any  incorporated  city,  or  city  and  county,  in  the 
State  of  California ; 


stock. 


INSURANCE   CORPORATIONS.  17 

4.  In  the  purchase  of  or  loans  upon  any  stocks  of  com- 
panies and  corporations  formed  under  the  laws  of  this  State, 
except  mining  stocks,  which  shall  have,  at  the  time  of  the  in- 
vestment, a  value,  in  the  City  and  County  of  San  Francisco, 
of  not  less  than  sixty  per  cent,  of  their  par  value,  and  shall 
be  rated  as  first  class  securities. 

But  no  loans  shall  be  made  on  any  securities  specified  in 
Subdivisions  2,  3,  and  4  of  this  Section,  in  any  amount  beyond 
sixty  per  cent,  of  the  market  value  of  the  securities,  nor  shall 
any  loan  be  made  on  the  stock  of  the  corporation  making  the 
loan. 

[Amended] 

Sec.  83.  Section  444  of  said  Code  is  amended  to  read 
as  follows : 

*     Sec.  444.     Life,  health,  and  accident  insurance  corpora-  i?3JJgS°* 
tions  may  invest  their  capital  stock  as  follows : 

One — In  loans  upon  unincumbered  and  improved  real  prop- 
erty within  the  State  of  California,  which  shall  be  worth  at 
the  time  of  the  investment  at  least  forty  per  cent,  more  than 
the  sum  loaned. 

Two — In  the  purchase  of  or  loans  upon  interest-bearing 
bonds,  and  other  securities  of  the  United  States  and  of  the 
State  of  California. 

Three — In  the  purchase  of  or  loans  upon  interest-bearing 
bonds  of  any  of  the  other  States  of  the  Union,  or  of  any 
county,  or  incorporated  city,  or  city  and  county,  in  the  State 
of  California. 

Four — In  the  purchase  of  loans  upon  any  stocks  of  cor- 
porations formed  under  the  laws  of  this  State,  except  of  mining 
corporations,  which  shall  have,  at  the  time  of  the  investment, 
a  value,  in  the  City  and  County  of  San  Francisco,  of  not  less 
than  sixty  per  cent,  of  their  par  value,  and  shall  be  rated  as 
first-class  securities ;  but  no  loans  shall  be  made  on  any  securi- 
ties specified  in  subdivisions  three  and  four  of  this  section,  in 
any  amount  beyond  sixty  per  cent,  of  the  market  value  of 
the  securities,  nor  shall  any  loan  be  made  on  the  stock  of  the 
corporation,  or  notes  or  other  obligations  of  its  corporators. 

Approved  March  30th,  1874. 


18 


CIVIL    CODE. 


Limitations 
to  the  hold- 
ing of  stock, 
and  in  other 
particulars, 
may  he  pro- 
vided for  in 
by-laws. 


Premiums, 
how  payable 


Corporations 
to  furnish 
Insurance 
Commis- 
sioner with 
data  for 
valuation  of 
policies  out- 
standing, 
when. 


How 

estimated. 


Sec.  445.  The  corporation  may,  by  its  by-laws,  limit  the 
number  of  shares  which  may  be  held  by  any  one  person,  and 
make  such  other  provisions  for  the  protection  of  the  stock- 
holders and  the  better  security  of  those  dealing  with  it  as  to 
a  majority  of  the  stockholders  may  seem  proper,  not  incon- 
sistent with  the  provisions  of  this  Title  or  Part. 

Sec.  446.  All  premiums  must  be  payable  wholly  in  cash, 
or  one  half  or  a  greater  proportion  in  cash,  and  the  remain- 
der in  promissory  notes  bearing  interest,  as  may  be  provided 
for  by  the  by-laws.  Agreements  and  policies  of  insurance 
made  by  the  corporation,  may  be  upon  the  basis  of  fall  or  par- 
tial participation  in  the  profits,  or  without  any  participation 
therein,  as  may  be  provided  by  the  by-laws  and  agreed  be- 
tween the  parties. 

Sec.  447.  Every  life  insurance  corporation  doing  busi- 
ness in  this  State,  or  formed  under  the  provisions  of  this  Part, 
must,  on  or  before  the  first  Monday  in  January  of  each  year, 
furnish  the  Insurance  Commissioner  the  necessary  data  for 
determining  the  valuation  of  all  its  policies  outstanding  on 
the  thirty-first  day  of  December  next  preceding ;  which 
valuation  must  be  based  upon  the  rate  of  mortality  as  estab- 
lished by  the  American  Experience  Life  Table.  The  rate 
of  interest  to  be  assumed  must  be  four  and  one  half  per  cent, 
per  annum. 

[Amended.] 

Sec.  84.  Section  447  of  said  Code  is  amended  to  read 
as  follows : 

Sec.  447.  Every  life  insurance  corporation  organized 
under  the  laws  of  this  State  must,  on  or  before  the  first  day 
of  February  of  each  year,  furnish  the  Insurance  Commis- 
sioner the  necessary  data  for  determining  the  valuation  of  all 
its  policies  outstanding  on  the  thirty-first  day  of  December 
then  next  preceding.  And  every  life  insurance  company  or- 
ganized under  the  laws  of  any  other  State  or  country,  and 
doing  business  in  this  State,  must,  upon  the  written  requisition 
of  the  Commissioner,  furnish  him,  at  such  time  as  he  may 
designate,  the  requisite  data  for  determining  the  valuation  of 


INSURANCE    CORPORATIONS.  19 

all  its  policies  then  outstanding;  such  valuations  must  be 
based  upon  the  rate  of  mortality  established  by  the  American 
Experience  Life  Table,  and  interest  at  four  and  one  half  per 
cent,  per  annum.  For  the  purpose  of  making  the  valuations, 
the  Insurance  Commissioner  is  authorized  to  employ  a  com- 
petent actuary,  whose  compensation  for  such  valuations  shall 
be  three  cents  for  each  thousand  dollars  of  insurance  ;  to  be 
paid  by  the  respective  companies  whose  policies  are  thus 
valued. 

Approved  March  30th,  1874. 

Sec.  448.     No  stamp  is  required  nor  stamp  duty  exacted  no  stamp 

1  x  *■  "  required  on 

on  any  contract  of  insurance,  when  such  contract  insures 
against  accident  which  may  result  in  injury  or  death. 


accident 
insurance- 
contract. 


Sec.  2.  The  following  sections  are  added  as  new  sections 
to  said  Code,  and  must  be  inserted  in  said  Code  after  Section 
448,  and  designated  as  Sections  449,  450,  and  451,  respect- 
ively : 

Sec.  449.  When  the  certificate  of  the  Insurance  Com-  Retauju00 
missioner  of  this  State,  of  the  valuation  of  the  policies  of  a 
life  insurance  company,  as  provided  in  Section  447  of  the 
Civil  Code  of  this  State,  issued  to  any  company  organized 
under  the  laws  of  this  State,  shall  not  be  accepted  by  the  in- 
surance authorities  of  any  other  State,  in  lieu  of  a  valuation 
of  the  same,  by  the  insurance  officer  of  such  other  State,  then 
every  company  organized  under  the  laws  of  such  other  State, 
doing  business  in  this  State,  shall  be  required  to  have  a  sepa- 
rate valuation  of  its  policies  made  under  the  authority  of  the 
Insurance  Commissioner  of  this  State,  as  provided  in  Section 
447  of  the  Civil  Code. 

Sec.  450.  Every  policy  of  insurance  upon  life  issued 
hereafter  within  the  limits  of  the  State  of  California,  whether 
by  a  person  or  corporation,  organized  under  the  laws  of  this 
State,  or  under  those  of  any  other  State  or  country,  or  by 
the  agent  of  such  person  or  corporation,  must  contain  written 
evidence  that  it  was  issued  in  this  State.  And  any  such 
policy  issued  in  this  State,  which  shall  not  contain  such  writ- 
ten evidence,  is,  at  the  option  of  the  holder,  null  and  void. 
And  the  person  or  corporation  issuing  such  policy,  without 
the  evidence  hereinbefore  required,  shall  forfeit  to  the  people 
of  the  State  of  California,  for  each  and  every  policy  so  issued, 
the  sum  of  one  hundred  dollars  in  United  States  gold  coin,  to 


Policies  is- 
sued within 
this  State  to 
contain  no- 
tice that  they 
were  so  issu- 
ed. 


20  CIVIL   CODE. 

be  collected  by  the  Insurance  Commissioner  as  provided  by 
Section  598  of  the  Political  Code. 
SpayinSt  Sec.  451.  Whenever,  during  the  life  of  any  policy  of  in- 
surance hereafter  issued  in  this  State,  such  policy  shall  be,  by 
the  legal  holder  thereof,  presented  to  the  person  or  corpora- 
tion issuing  the  same,  or  to  the  agent  of  such  person  or 
corporation,  for  payment  and  cancellation,  such  person  or  cor- 
poration must,  within  sixty  days  after  such  presentation  and 
demand  of  payment,  pay  to  the  holder  of  such  policy,  in  like 
currency  to  that  of  the  policy,  a  sum  equal  to  seventy-five 
per  cent,  of  the  then  present  value  of  such  policy,  as  ascer- 
tained and  determined  in  accordance  with  the  provisions  of 
Section  447  of  the  Civil  Code,  and  such  payment  shall  be  a 
full  and  complete  liquidation  of  such  policy. 
Approved  March  30th,  1874. 


Political  Code 


AN  ACT  TO  ESTABLISH  A  POLITICAL  CODE. 

Approved  March  12th,  1872. 


TITLE  OF  THE  ACT. 

Section  1.  This  Act  shall  be  known  as  The  Political  g$^£*  of 
Code  of  the  State  of  California.    *    *    * 

Sec.  2.  This  Code  takes  effect  at  twelve  o'clock,  noon,  of  JgyggJ, 
the  first  clay  of  January,  eighteen  hundred  and  seventy-three. 


Sec.  18.     No  statute,  law,  or  rule  is  continued  in  force  J*JJ*f' 
because  it  is  consistent  with  the  provisions  of  this  Code  on  Sj&twiS 
the  same  subject,  but  in  all  cases  provided  for  by  this  Code  peaiod. 
all  statutes,  laws,  and  rules  heretofore  in  force  in  this  State, 
whether  consistent  or  not  with  the  provisions  of  this  Code, 
unless  expressly  continued  in  force  by  it,  are  repealed  and 
abrogated.     This  repeal  or  abrogation  does  not  revive  any 
former  law  heretofore  repealed,  nor  does  it  affect  any  right 
already  existing  or  accrued,   or  any    action  or  proceeding 
already  taken,  except  as  in  this  Code  provided  ;  nor  does  it 
affect  any  private  or  local  statute  not  expressly  repealed. 


Sec.  20.     This  Act  whenever  cited,  enumerated,  referred  Jh 
to,  or  amended,  may  be  designated  simply  as  The  Political 
Code,  adding,  when  necessary,  the  number  of  the  section. 
3 


is  Act. 
ow  cited, 
etc. 


22  POLITICAL  CODE. 

Sec.  11.  The  following  is  added  as  a  new  section  to  said 
Code,  and  must  be  inserted  in  said  Code  after  Section  336, 
and  designated  Section  337. 
SmSn-  ^EC-  ^37 .  Of  the  report  of  the  Insurance  Commissioner, 
er's  report,  the  Commissioner  must  have  printed,  at  the  expense  of  his 
office,  one  thousand  copies,  and  must  deliver  of  the  same  as 
follows  : 

To  the  Governor,  twenty  copies. 

To  the  State  Librarian,  ten  copies. 

To  the  Secretary  of  State,  thirty  copies. 

To  the  Sergeant-at-arms  of  the  Senate,  eighty  copies. 

To  the  Sergeant-at-arms  of  the  Assembly,  one  hundred  and 
sixty  copies. 

And  the  residue  must  be  distributed  by  the  Commissioner 
in  furtherance  of  the  interest  of  insurance. 

Approved  March  30th,  1874. 


PART  III. 

CHAPTER,    III. 
ARTICLE  XVI. 

INSURANCE   COMMISSIONER. 

Section  594.     Eligibility. 

595.  General  duties  of. 

596.  Business  of  insurance  not  to  be  transacted  without  his  cer- 

tificate. 

597.  To  examine  affairs  of  companies,  when. 

598.  Fines  imposed  if  companies  refuse. 

599.  May  issue  subpoenas. 

600.  Proceedings  on  insolvency  of  companies;  must  require  cap- 

ital stock  to  be  repaired,  when. 

601.  Proceedings  when  this  is  not  done. 

602.  What  constitutes  insolvency. 

603.  Must  keep  a  record. 

601.  May  emplcy  actuary,  when. 

605.  Fees  to  be  paid  to  Commissioner. 

606.  Assessments  for  deficiency  in  salary  and  expenses. 

607.  Certain  certificates  to  be  filed  in  his  office. 

608.  Same. 

609.  May  determine  name  of  new  corporation. 

610.  Scatemento  to  be  made  by  insurance  companies. 

611.  Statements,  when  to  be  made. 

612.  Form  of. 

613.  Same. 

614.  Stock  notes,  how  computed. 

615.  To  furnish  blanks. 

616.  Agents  upon  whom  process  may  be  served. 

617.  Duties   of    Commissioner    when    companies   fail   to   make 

statement. 

618.  Deposits  and  dividends. 


24 


POLITICAL   CODE. 


Section  619.     Deposits,  receipts  for. 

020.  Deposits  returned,  when. 

621.  Examination  of  securities. 

622.  Retaliatory  clause. 

623.  Bonds  from  foreign  corporations. 

624.  Same. 

625.  Commissioner  to  furnish  Assessor  with  certain  information. 

626.  Securities. 

627.  Statements  to  be  based  on  gold  coin  value. 

628.  Salary. 

629.  Salary  of  deputy. 

630.  Contingent  expenses. 

631.  Location  of  office. 

632.  Official  bond. 

633.  Licensing  solicitors. 

Eligibility.         Section  594.     No  person  is  eligible  to  the  office  of  Insu- 
rance  Commissioner  or  Deputy  who  is  an  officer,  agent,  or 

employe  of  an  insurance  company. 


General 
duties  of. 


Sec.  595.  The  Insurance  Commissioner  must  receive  all 
bonds  and  securities  of  persons  engaged  in  the  transaction  of 
insurance  business  in  this  State,  and  file  and  safely  keep  the 
same  in  his  office,  or  deposit  them  as  provided  in  this  Arti- 
cle. He  must  examine  and  inspect  the  financial  condition  of 
all  persons  engaged  or  who  desire  to  engage  in  the  business 
of  insurance ;  issue  a  certificate  of  authority  to  transact  in- 
surance business  in  this  State  to  any  persons  in  a  solvent  con- 
dition who  have  fully  complied  with  the  laws  of  this  State  ; 
determine  the  sufficiency  and  validity  of  all  bonds  and  other 
securities  required  to  be  given  by  persons  engaged  or  to  be 
engaged  in  insurance  business,  and  cau?e  the  same  to  be  re- 
newed in  case  of  the  insufficiency  or  invalidity  thereof,  and 
perform  all  other  duties  imposed  upon  him  by  the  laws  regu- 
lating the  business  of  insurance  in  this  State,  and  enforce  the 
execution  of  such  laws ;  prepare  and  furnish  on  demand,  to 
all  persons  engaged  in  the  insurance  business,  blank  forms  for 
such  statements  or  reports  as  may  by  law  be  required  of 
them ;  make,  on  or  before  the  first  day  of  August  in  each 
year,  a  report  to  the  Governor  of  this  State,  containing  a  tab- 


INSURANCE   COMMISSINOER.  25 

ular  statement  and  synopsis  of  the  reports  which  have  been 
filed  in  his  office,  showing  generally  the  condition  of  the  in- 
surance business  and  interests  in  this  State,  and  other  mat- 
ters concerning  insurance,  and  a  detailed  statement,  verified 
by  oath,  of  the  moneys  and  fees  of  office  received  by  him,  and 
for  what  purposes. 

[Amended.] 

Sec.  13.     Section  595  of  said  Code  is  amended  to  read  \ 

as  follows : 

Sec.  595.  The  Insurance  Commissioner  must  receive  all  same.  , 
bonds  and  securities  of  persons  engaged  in  the  transaction  of 
insurance  business  in  this  State,  and  file  and  safely  keep  the 
same  in  his  office,  or  deposit  them  as  provided  in  this  Article. 
He  must  examine  and  inspect  the  financial  condition  of  all 
persons  engaged  or  who  desire  to  engage  in  the  business  of 
insurance ;  issue  a  certificate  of  authority  to  transact  insur- 
ance business  in  this  State  to  any  persons  in  a  solvent  con- 
dition who  have  fully  complied  with  the  laws  of  this  State ; 
determine  the  sufficiency  and  validity  of  all  bonds,  and  other 
securities,  required  to  be  given  by  persons  engaged  or  to  be 
engaged  in  insurance  business,  and  cause  the  same  to  be  re- 
newed in  case  of  the  insufficiency  or  invalidity  thereof ;  and 
perform  all  other  duties  imposed  upon  him  by  the  laws  regu- 
lating the  business  of  insurance  in  this  State,  and  enforce  the 
execution  of  such  laws;  prepare  and  furnish  on  demand,  to 
all  persons  engaged  in  the  insurance  business,  blank  forms  for 
such  statements  or  reports  as  may  by  law  be  required  of 
them ;  make,  on  or  before  the  first  day  of  August,  in  each 
year,  a  report  to  the  Governor  of  this  State,  containing  a  tabu- 
lar statement  and  synopsis  of  the  reports  which  have  been 
filed  in  his  office,  showing  generally  the  condition  of  the  in- 
surance business  and  interests  in  this  State,  and  other  matters 
concerning  insurance,  and  a  detailed  statement,  verified  by 
oath,  of  the  moneys  and  fees  of  office  received  by  him,  and 
for  what  purpose.  And  whenever  any  insurance  company 
doing  business  in  this  State  shall  voluntarily  surrender  to  the 
Insurance  Commissioner  its  certificate  of  authority  previously 
granted,  thereby  withdrawing  from  business  in  this  State,  the 
Commissioner  must  make  due  publication  of  such  surrender 
and  withdrawal,  daily,  for  the  period  of  one  month,  in  some 
newspaper  published  in  the  City  of  San  Francisco. 

Approved  March  80th,  1874. 


26 


POLITICAL   CODE. 


Business  of 
insurance 
not  to  be 
transacted 
without  his 
certificate. 


Same. 


Same. 


Sec.  596.  No  person  must  transact  insurance  business  in 
this  State  without  first  procuring  from  the  Insurance  Commis- 
sioner a  certificate  of  authority,  as  in  this  chapter  provided ; 
and  all  policies  issued  or  renewed  and  all  insurances  taken 
before  the  issuing  of  such  certificates,  are  null  and  void. 

[Amended.] 

Sec.  14.  Section  596  of  said  Code  is  amended  to  read 
as  follows : 

Sec.  596.  No  person  must  transact  insurance  business  in 
this  State  without  first  procuring  from  the  Insurance  Commis- 
sioner a  certificate  of  authority,  as  in  this  Chapter  provided ; 
and  all  policies  issued  or  renewed,  and  all  insurance  taken 
before  the  issuing  of  such  certificate,  are  null  and  void ;  and 
any  person  issuing  or  renewing  a  policy  without  such  certifi- 
cate, shall  forfeit  to  the  people  of  the  State  of  California  the 
sum  of  one  hundred  dollars  for  each  policy  so  issued  or  re- 
newed, to  be  collected  in  the  manner  prescribed  in  Section 
598  of  this  Code. 

Approved  March  30th,  1874. 

[Amended  a  second  time.] 

Section  596  of  the  Political  Code  is  amended  to  read  as 
follows : 

Sec.  596.  No  person  must  transact  insurance  business  in 
this  State  without  first  procuring  from  the  Insurance  Commis- 
sioner a  certificate  of  authority,  as  in  this  Chapter  provided ; 
and  all  policies  issued  or  renewed,  and  all  insurances  taken 
before  obtaining  such  certificate  of  authority,  are  null  and 
void ;  and  any  person  issuing  or  renewing  a  policy  without 
such  certificate,  shall  forfeit  to  the  people  of  the  State  of 
California  the  sum  of  one  hundred  dollars  for  each  policy  so 
issued  or  renewed,  to  be  collected  by  the  Insurance  Commis- 
sioner in  the  manner  prescribed  in  Section  598  of  this  Code. 
But  any  company  or  corporation  belonging  to  any  other  State 
or  country,  having  policies  of  life  insurance  outstanding  in 
this  State,  and  that  were  issued  in  accordance  with  the  laws 
of  the  State,  shall  have  the  right  to  maintain  an  agent  in  this 
State  for  the  collection  of  renewal  premiums  on  such  policies, 
and  the  Commissioner  is  hereby  authorized  to  issue  to  the  duly 
appointed  agent  of  such  company  or  corporation  a  certificate 
authorizing  him  to  collect  such  premiums.  But  the  company 
or  corporation  must  satisfy  the  Commissioner  that  it  is  author- 
ized to  transact  insurance  business  in  the  State  to  which  it 


INSURANCE   COMMISSIONER.  27 

belongs.  The  agent  must,  on  or  before  the  tenth  clay  of  Jan- 
uary in  each  year,  file  with  the  Commissioner  a  statement, 
under  oath,  showing  the  gross  amount  of  premiums  collected 
by  him  during  the  year  ending  on  the  thirty-first  day  of  De- 
cember next  preceding ;  and  upon  filing  such  statement  he 
must  pay  into  the  office  of  the  Commissioner  the  sum  of 
twenty  dollars,  in  gold  coin  of  the  United  States. 
Approved  March  30th,  1874. 

Sec.  597.     The   Commissioner,   whenever  necessary,  or  to  examine 

'  m  J  '  affairs  of 

whenever  he  is  requested  by  verified  petition,  signed  by  three  SBS"1^ 
persons  interested,  either  as  stockholders,  policy-holders,  or 
creditors  of  any  person  engaged  in  insurance  business,  show- 
ing that  such  person  is  insolvent  under  the  laws  of  this  State, 
must  make  examination  of  the  business  and  affairs  relating 
to  the  insurance  business  of  such  person  ;  and  for  such  pur- 
pose has  free  access  to  all  the  books  and  papers  of  such  per- 
son, and  must  thoroughly  inspect  and  examine  all  his  affairs, 
and  ascertain  his  condition  and  ability  to  fulfill  his  engage- 
ments, and  whether  he  has  complied  with  all  the  provisions 
of  law  applicable  to  his  insurance  transactions.  Such  person 
and  his  officers  and  agents  must  open  his  books  and  papers 
for  the  inspection  of  the  Commissioner,  and  otherwise  facili- 
tate such  examination ;  and  the  Commissioner  may  adminis- 
ter oaths  and  examine  under  oath  any  persons  relative  to  the 
business  of  such  person  ;  and  if  he  finds  the  books  to  have 
been  carelessly  or  improperly  kept  or  posted,  he  must  employ 
sworn  experts  to  re-write,  post,  and  balance  the  same  at  the 
expense  of  such  person.  Such  examination  must  be  con- 
ducted in  the  county  where  such  person  has  his  principal 
place  of  business,  and  must  be  private,  unless  the  Commis- 
sioner deems  it  necessary  to  publish  the  result  of  such  inves- 
tigation, in  which  case  he  may  publish  the  same  in  two  of  the 
public  newspapers  of  this  State,  one  of  which  must  be  pub- 
lished in  the  City  of  San  Francisco. 

Sec.  593.     The  Commissioner  may  collect  the  sum  of  five  Fines  impos- 

•'  eclifcompan- 

hundred  dollars  from  any  person  engaged  in  the  business  of  iesretuse- 


28  POLITICAL   CODE. 

insurance  for  each  refusal  to  give  full  and  truthful  informa- 
tion and  response  in  writing  to  any  inquiry  in  writing  by  the 
Commissioner  relating  to  the  business  of  insurance  as  carried 
on  by  him  ;  and  for  that  purpose  suits  may  be  instituted  by 
the  Commissioner,  in  the  name  of  the  People  of  the  State  of 
California,  in  any  Court  of  competent  jurisdiction. 

2JK5JJJ  Sec.  599.     The  Commissioner  may  issue  subpoenas   for 

witnesses  to  attend  and  testify  before  him  on  any  subject 
touching  insurance  business,  or  in  aid  of  his  duties,  which 
must  be  served,  obeyed,  and  enforced  as  provided  in  the  Code 
of  Civil  Procedure  for  civil  cases,  the  Commissioner  to  issue 
attachments  and  impose  the  penalty  for  disobedience ;  and, 
in  addition,  the  defaulting  witness  may  be  punished  as  pro- 
vided in  the  Penal  Code. 

on^nloilcn-  Sec.  600.  Whenever  the  Commissioner  ascertains  that 
pan°ies°m  any  person  engaged  in  the  insurance  business  is  insolvent 
within  the  meaning  of  this  Chapter,  he  must  revoke  the  cer- 
tificate granted,  and  send  by  mail  to  such  person,  addressed 
to  him  at  his  principal  place  of  business,  or  deliver  to  him 
personally,  notice  of  such  revocation,  and  cause  notice  thereof 
to  be  filed  in  his  office  and  also  to  be  published  daily  for  four 
weeks  in  some  newspaper  published  in  the  City  of  San  Fran- 
cisco. He  must  require  such  person,  after  receiving  notice 
of  the  revocation,  or  after  the  first  publication  thereof,  to  dis- 
continue the  issuing  any  new  policies  and  the  renewal  of  any 
Must  require  previously  issued ;  and  in  such  cases  must  require  the  person 

capital  stock  ,  ^it-  •  •     i 

to  be  repair-  0r  the  manager  or  a^ent  of  the  business  to  renair  the  capital 

eu,  when.  o  o  r 

thereof  within  such  period  as  he  may  designate  in  such  requi- 
sition by  assessment  upon  the  stockholders  for  such  amounts 
as  will  make  the  capital  equal  to  the  amount  of  the  paid  up 
capital,  exclusive  of  assets  needed  to  pay  all  ascertained  lia- 
bilities for  losses  reported,  for  expenses  and  taxes,  and  exclu- 
sive of  the  entire  premiums  received  for  outstanding  risks. 


INSURANCE   COMMISSIONER.  29 

Sec.  601.  In  case  any  person,  upon  the  requisition  of  wiSfSSfi 
the  Commissioner,  fails  to  make  up  the  deficiency  of  the  capi- 
tal in  accordance  with  the  requirements  of  this  Chapter,  or  to 
comply  in  all  respects  with  the  laws  of  this  State,  the  Com- 
missioner must  communicate  the  fact  to  the  Attorney  Gen- 
eral, who  must  commence  an  action  in  the  name  of  the  People 
of  this  State,  in  the  District  Court  of  the  Judicial  District 
where  the  person  in  question  is  located  or  has  his  principal 
office,  against  such  person,  and  apply  for  an  order  requiring 
cause  to  be  shown  why  the  business  should  not  be  closed ; 
and  the  Court  must  thereupon  hear  the  allegations  and  proofs 
of  the  respective  parties  as  in  other  cases.  If  it  appears 
to  the  satisfaction  of  the  Court  that  such  person  is  insolvent, 
or  that  the  interests  of  the  public  so  require,  the  Court  must 
decree  a  dissolution  of  such  corporation,  and  a  winding  up  of 
its  affairs  and  a  distribution  of  the  effects  of  such  person  ;  but 
otherwise  the  Court  must  enter  a  decree  annulling  the  act  of 
the  Commissioner  in  the  premises,  and  authorizing  such  per- 
son to  resume  business.  But  the  Commissioner  must  not  be 
held  liable  for  damages,  if  he  has  acted  in  good  faith.  In 
the  event  of  any  additional  losses  occurring  upon  new  risks 
taken  after  the  expiration  of  the  period  limited  i  by  the  Com- 
missioner in  the  requisition,  and  before  the  deficiency  has 
been  filled  up,  the  Directors  of  any  company,  corporation,  or 
association  are  individually  liable  to  the  extent  thereof. 


tutes  insol- 
vency. 


Sec.  602.  Whenever  the  liabilities  of  any  person  engaged  ^hat.eonsti- 
in  the  insurance  business,  for  losses  reported,  expenses,  taxes, 
and  reinsurance  of  all  outstanding  risks,  estimated  at  fifty  per 
cent,  of  the  premiums  received  on  fire  risks  and  marine  time 
risks,  at  the  full  premiums  on  all  other  marine  risks,  and  at 
rates  for  life  risks  based  upon  the  rate  of  mortality  as  estab- 
lished by  the  American  Experience  Life  Table,  and  the  rate 
of  interest  assumed  to  be  four  and  one  half  per  cent,  per  an- 
num, and  such  rates  for  accidental  and  other  kinds  of  insur- 
ance as  are  generally  accepted  by  the  Superintendent  of  the 
Insurance  Department  of  the  State  of  New  York,  would  im- 


30  POLITICAL   CODE. 

pair  his  capital  stock  already  paid  in  to  an  extent  exceeding 
twenty  per  cent.,  such  person  is  insolvent. 

[Amended.] 

Sec.  15.     Section  602  of  said  Code  is  amended  to  read 
as  follows : 
same.  gEC#  gQ2#     Whenever  provision  for  the  liabilities  of  any 

person  engaged  in  the  insurance  business  in  this  State,  for 
losses  reported,  expenses,  taxes,  and  reinsurance  of  all  out- 
standing risks  estimated  at  fifty  per  cent,  of  the  premiums 
received  and  receivable  on  all  fire  risks  and  marine  time  risks, 
at  the  full  premiums  received  and  receivable  on  all  other 
marine  risks,  and  at  rates  for  life  risks,  based  upon  the  rate  of 
mortality  established  by  the  American  Experience  Life  Table, 
and  interest  at  four  and  one  half  per  cent,  per  annum,  and 
such  rates  for  accident  and  other  kinds  of  insurance  as  are 
accepted  by  the  insurance  authorities  of  the  State  of  New 
York,  would  so  far  impair  his  capital  stock  paid  in  as  to  re- 
duce the  same  below  two  hundred  thousand  dollars  in  gold 
coin  of  the  United  States,  or  below  twenty  per  cent,  of  said 
capital  stock  paid  in,  such  person  is  insolvent.  And  in  the 
case  of  a  person  thus  engaged  in  the  insurance  business  in 
this  State,  on  the  mutual  plan,  if  his  available  cash  assets 
shall  not  exceed  his  liabilities,  as  hereinbefore  enumerated,  in 
the  full  sum  of  two  hundred  thousand  dollars  in  United  States 
gold  coin,  such  person  is  insolvent. 
Approved  March  30th,  1874. 

[Amended  a  second  time.] 

Section  1.  Section  602  of  the  Political  Code  is  amended 
to  read  as  follows  : 

Sec.  602.  Whenever  provision  for  the  liabilities  of  any 
person  engaged  in  the  insurance  business  in  this  State  for 
losses  reported,  expenses,  taxes,  and  reinsurance  of  all  out- 
standing risks  estimated  at  fifty  per  cent,  of  the  premiums  re- 
ceived and  receivable  on  all  fire  risks  and  marine  time  risks,  at 
the  full  premiums  received  and  receivable  on  all  other  marine 
risks,  and  at  rates  for  life  risks  based  upon  the  rates  of  mor- 
tality established  by  the  American  Experience  Life  Table, 
and  interest  at  four  and  one  half  per  cent,  per  annum,  and 
such  rates  for  accident  and  other  kinds  of  insurance  as  are 
accepted  by  the  insurance  authorities  of  the  State  of  New 
York,  would  so  far  impair  his  capital  stock  paid  in  as  to  reduce 
the  same  below  two  hundred  thousand  dollars  in  gold  coin  of 


INSURANCE   COMMISSIONER.  31 

the  United  States,  or  below  sixty  per  cent,  of  said  capital 
stock  paid  in,  such  person  is  insolvent ;  and  in  the  case  of  a 
person  thus  engaged  in  the  insurance  business  in  this  State 
on  the  mutual  plan,  if  his  available  cash  assets  shall  not  ex- 
ceed his  liabilities  as  hereinbefore  enumerated,  in  the  full  sum 
of  two  hundred  thousand  dollars  in  United  States  gold  coin, 
such  person  is  insolvent. 

Approved  March  30th,  1874. 


Sec.  603.     The  Commissioner  must  keep  and  preserve  in  Must  keep  a 
a  permanent  form  a  full  record  of  his  proceedings,  including 
a  concise  statement  of  the  condition  of  each  person  visited  or 
examined  by  him. 

Sec  604.     The  Commissioner  may  employ  an  actuary  to  May  employ 
make  the  valuation  of  life  policies  at  the  compensation  of  not  when.  ' 
exceeding  three  cents  for  each  thousand  dollars  of  insurance, 
to  be  paid  by  the  person  or  corporation  for  which  the  valua- 
tion is  made. 

Sec.  605.     The  Commissioner  must  require  in  advance,  Fees  to  be 

1  paid  to  Com- 

m  United  States  gold  coin,  the  following  fees :  missioned 

1.  For  filing  the  articles  of  incorporation  or  certified  copy 
of  articles  or  other  certificate  required  to  be  filed  in  his  office, 
thirty  dollars ; 

2.  For  filing  the  annual  statement  required  to  be  filed, 
twenty  dollars ; 

3.  For  filing  any  other  papers  required  by  this  Chapter 
to  be  filed,  five  dollars ; 

4.  For  furnishing  copies  of  papers  filed  in  his  office, 
twenty  cents  per  folio  ; 

5.  For  certifying  copies,  one  dollar  each ; 

6.  For  each  certificate  issued,  as  provided  in  section  six 
hundred  and  nineteen,  the  sum  of  five  dollars. 

Sec.  606.     If  the  salary  of  the  Commissioner  and  the  ex-  Assessments 
penses  of  his  office  exceed  the  fees  and  charges  collected  bv  °y  !n  salary 

°  J     and  expen- 

him,  such  excess  must  be  annually  assessed  by  the  Commis-  scs- 


32  POLITICAL   CODE. 

sioner  upon  all  persons  or  corporations  engaged  in  the  busi- 
ness of  insurance  in  this  State,  and  they  are  severally  liable 
therefor,  pro  rata,  according  to  the  amount  of  premiums  re- 
ceived or  receivable  from  risks  taken  in  this  State,  respective- 
ly, during  the  year  ending  on  the  thirty-first  day  of  Decem- 
ber next  preceding  the  assessment.  The  Commissioner  must 
collect  all  fees  and  assessments,  and  pay  monthly  into  the 
State  Treasury  whatever  amounts  may  be  received  and  col- 
lected by  him.  He  may  bring  actions  in  the  name  of  the 
People  of  this  State  to  enforce  such  collections  ;  and  any  per- 
son liable  for  any  assessment  who  neglects  or  refuses  to  pay 
the  amount  of  such  assessment  within  ten  days  after  demand 
thereof  in  writing  by  the  Insurance  Commissioner,  becomes 
liable  to  pay  double  the  amount  of  such  assessment,  and  any 
judgment  recovered  in  such  case  must  be  for  such  double 
amount  and  costs. 

certain  cer-        Sec.  607.     The  Commissioner  must  cause  every  corpora- 

tificates  to  be  J  r 

Sfflceinhis      ti°n  or  person,  before  engaging  in  the  business  of  insurance, 
to  file  in  his  office,  as  follows : 

1.  If  incorporated  under  the  laws  of  this  State,  a  copy  of 
the  articles  of  incorporation  or  statement  of  any  increase  or 
diminution  of  the  capital  stock,  certified  by  the  Secretary  of 
State  to  be  a  copy  of  that  which  is  filed  in  his  office  ; 

2.  If  incorporated  under  the  laws  of  any  other  State  or 
country,  a  copy  of  the  articles  of  incorporation,  if  organized 
or  formed  under  any  law  requiring  articles  to  be  filed,  duly 
certified  by  the  officer  having  the  custody  of  such  articles ; 
or  if  not  so  organized,  a  copy  of  the  law,  charter,  or  deed  of 
settlement  under  which  the  organization  is  made,  duly  certi- 
fied by  the  proper  custodian  thereof,  or  proved  by  affidavit  to 
be  a  copy ;  also,  a  certificate  under  the  hand  and  seal  of  the 
proper  officer  of  such  State  or  country  having  supervision  of 
insurance  business  therein,  that  such  corporation  or  company  is 
organized  under  the  laws  of  such  State  or  country,  with  the 
amount  of  capital  stock  or  assets  required  by  this  Chapter; 


INSURANCE   COMMISSIONER.  33 

3.  If  not  incorporated,  a  certificate  setting  forth  the  na- 
ture and  character  of  the  business,  the  location  of  the  princi- 
pal office,  the  names  of  the  persons  and  of  those  composing 
the  association,  the  amount  of  actual  capital  employed  or  to 
be  employed  therein,  and  the  names  of  all  officers  and  per- 
sons by  whom  the  business  is  or  may  be  managed.  The  cer- 
tificate must  be  verified  by  the  affidavit  of  the  chief  officer, 
Secretary,  agent,  or  manager  of  the  association ;  and  if  there 
are  any  written  articles  of  agreement  or  association,  a  copy 
thereof  must  accompany  such  certificates. 

Sec.  608.     He  must  require  from  every  insurance  associa-  sana- 
tion not  formed  under  the  laws  of  this  State,  or  not  incorpo- 
rated, carrying  on  the  business  of  insurance  by  an  agent : 

1.  A  certified  or  verified  power  of  attorney  or  written 
authority  to  such  agent ; 

2.  A  notice  of  any  change  of  agents  or  in  the  powers  of 
any  agent,  within  ninety  days  after  such  change,  and  a  cer- 
tified copy  of  any  new  or  further  power  of  attorney  or  author- 
ity before  the  same  is  aeted  under  ; 

3.  When  by  any  law,  agreement,  or  other  writing,  any 
change  is  made  in  respect  to  any  of  the  particulars  set  forth 
in  the  certificate  on  file,  a  certified  copy  of  such  law,  agree- 
ment, or  other  writing,  verified  respectively  as  certificates 
are  required  to  be  verified  ;  also,  a  notice  of  such  change 
before  the  same  is  acted  under. 

Sec.  609.     The    Commissioner    must  require  the  name  May  deter- 

...  '  mine  name  of 

under  which  any  corporation  hereafter  proposes  to  be  formed  n.ewcorPora- 
or  organized  under  the  laws  of  this  State,  for  the  transaction 
of  insurance  business,  to  be  submitted  to  him  before  the  com- 
mencement of  such  business ;  and  he  may  reject  any  name  or 
title  so  submitted  when  the  same  is  an  interference  with  or 
too  similar  to  one  already  appropriated,  or  likely  to  mislead  the 
public  in  any  respect ;  and  in  such  case  a  name  not  liable  to 
such  objection  must  be  ehosem 


34 


POLITICAL   CODE. 


Statements 
to  be  made 
by  insurance 
companies. 


Statement, 
when  to  be 
made. 


Sec.  610.  The  Commissioner  must  require  from  every 
corporation  or  person  doing  the  business  of  insurance  in  this 
State,  a  statement  verified  as  follows : 

1.  If  it  is  made  by  a  corporation  organized  under  the 
laws  of  this  State,  by  the  oaths  of  the  President  and  Secretary, 
or  of  the  Vice-President  and  Secretary  thereof ; 

2.  If  made  by  a  foreign  insurance  company  or  person, 
by  the  oath  of  the  principal  executive  officer  thereof,  or  by 
the  oath  of  a  duly  authorized  agent  thereof  residing  in  this 
State  ; 

3.  If  it  is  made  by  an  individual  or  firm,  by  the  oath  of 
such  individual  or  a  member  of  the  firm. 

[Amended.] 

Sec.  16.  Section  610  of  said  Code  is  amended  to  read 
as  follows : 

Sec.  610.  The  Commissioner  must  require  from  every 
corporation  or  person  doing  the  business  of  insurance  in  this 
State,  a  statement,  verified  as  follows : 

One — If  it  be  made  by  a  corporation  organized  under  the 
laws  of  this  State,  by  the  oaths  of  the  President  and  Secre- 
tary, or  of  the  Vice-President  and  Secretary  thereof. 

Two — If  made  by  a  foreign  insurance  company  or  person, 
by  the  oath  of  the  principal  executive  officer  thereof. 

Three — If  it  be  made  by  an  individual  or  firm,  by  the  oath 
of  such  individual  or  a  member  of  the  firm. 

Approved  March  30th,  1874. 

Sec.  611.  The  statement  mentioned  in  the  preceding  sec- 
tion must  exhibit  the  condition  and  affairs  of  every  such  cor- 
poration, person,  firm,  or  individual,  on  the  thirty-first  day  of 
December  then  next  preceding,  and  must  be  published  in  a 
daily  newspaper  in  the  city  where  the  principal  office  is 
located  for  the  period  of  one  week  ;  and  must  be  filed  with 
the  Insurance  Commissioner,  as  follows : 

1.  By  persons  transacting  the  business  of  fire,  marine,  or 
inland  insurance : 

(a)     If  made  by  a  person  residing  in  or  by  a  company 


INSURANCE   COMMISSIONER. 

organized  under  the  laws  of  this  State,  on  or  before  the  first 
day  of  February  of  each  year ; 

(6)  If  made  by  a  person  resident  of  or  by  a  company 
organized  under  the  laws  of  any  other  State  or  Territory  or 
District  of  the  United  States,  on  or  before  the  first  day  of 
June  of  each  year ; 

(c)  If  made  by  a  person  resident  of  or  by  a  company 
organized  under  the  laws  of  any  country  foreign  to  the  United 
States,  on  or  Jbefore  the  first  day  of  June  of  each  year. 

2.  By  persons  transacting  the  business  of  insurance,  other 
than  fire,  marine,  or  inland : 

(a)  If  made  by  a  person  residing  in  or  by  a  company 
organized  under  the  laws  of  this  State,  on  or  before  the  first 
day  of  March  of  each  year ; 

(6)  If  made  by  a  person  resident  of  or  by  a  company 
organized  under  the  laws  of  any  other  State  or  Territory  or 
District  of  the  United  States,  on  or  before  the  first  day  of 
April  of  each  year  ; 

(e)  If  made  by  a  person  resident  of  or  by  a  company 
organized  under  the  laws  of  any  country  foreign  to  the  United 
States,  on  or  before  the  first  day  of  June  of  each  year. 

[Amended.] 

Sec.  17.  Section  611  of  said  Code  is  amended  to  read  as 
follows  : 

Sec  611.  The  statement  mentioned  in  the  preceding  sec-  s*me. 
tion  must  exhibit  the  condition  and  affairs  of  every  corpora- 
tion, person,  firm,  or  individual,  on  the  thirty-first  day  of  De- 
cember then  next  preceding,  and  must  be  published  in  a  daily 
newspaper  in  the  city  where  the  principal  office  is  located,  for 
the  period  of  one  week ;  and  must  be  filed  with  the  Insurance 
Commissioner,  as  follows: 

One — If  made  by  a  person  residing  in,  or  by  a  company 
organized  under  the  laws  of  this  State,  on  or  before  the  first 
day  of  February  of  each  year. 

Two — If  made  by  a  person  resident  of,  or  by  a  company 
organized  under  the  laws  of  any  other  State,  or  Territory,  or 
District  of  the  United  States,  on  or  before  the  first  day  of 
March  of  each  year. 


35 


36  POLITICAL   CODE. 

Three — If  made  by  a  person  resident  of,  or  by  a  company 
organized  under  the  laws  of  any  country  foreign  to  the  United 
States,  on  or  before  the  first  day  of  April  of  each  year. 

Approved  March  30th,  1874. 

shovv!to  ^EC-  612.     Such  statement,  if  made  by  fire,  marine,  and 

inland  insurance  companies,  must  show  : 

First. 

The  amount  of  the  capital  stock  of  the  company. 

Second. 

The  property  or  assets  held  by  the  company,  specifying  : 

1.  The  value  of  real  estate  held  by  such  company  ; 

2.  The  amount  of  cash  on  hand  and  deposited  in  banks  to 
the  credit  of  the  company,  specifying  the  same  ; 

3.  The  amount  of  cash  in  the  hands  of  agents  and  in 
course  of  transmission. 

4.  The  amount  of  loans  secured  by  bonds  and  mortgages 
constituting  the  first  lien  on  real  estate  on  which  there  is  less 
than  one  year's  interest  due  or  owing ; 

5.  The  amount  of  loans  on  which  interest  has  not  been 
paid  within  one  year  previous  to  such  statement ; 

6.  The  amount  due  the  company  on  which  judgments 
have  been  obtained  ; 

7.  The  amount  of  stocks  of  this  State,  of  the  United 
States,  of  any  incorporated  city  of  this  State,  and  of  any 
other  stocks  owned  by  the  company,  specifying  the  amount, 
number  of  shares,  and  par  and  market  value  of  each  kind 
of  stock  ,* 

8.  The  amount  of  stocks  held  as  collateral  security  for 
loans,  with  the  amount  loaned  on  each  kind  of  stock,  its  par 
value  and  market  value ; 

9.  The  amount  of  interest  due  and  unpaid ; 

10.  The  amount  of  all  other  loans  made  by  the  company , 
specifying  the  same ; 


INSURANCE    COMMISSIONER.  37 

11.  The   amount  of  premium  notes  on  hand  on   which  Same' 
policies  are  issued ; 

12.  All  other  property  belonging  to  the  company,  specify- 
ing the  same. 

Third. 

The  liabilities  of  such  company,  specifying : 

1.  The  amount  of  losses  due  and  unpaid  ; 

2.  The  amount  of  claims  for  losses  resisted  by  the  com- 
pany; 

3.  The  amount  of  losses  in  process  of  adjustment  or  in 
suspense,  including  all  reported  or  supposed  losses  ; 

4.  The  amount  of  dividends  declared,  due  and  remaining 
unpaid  ; 

5.  The  amount  of  dividends  declared,  but  not  due  ; 

6.  The  amount  of  money  borrowed  and  security  given  for 
the  payment  thereof; 

7.  Gross  premiums  (without  any  deduction)  received 
and  receivable  upon  all  unexpired  fire  risks  running  one 
year  or  less  from  date  of  policy — reinsurance  thereon  at  fifty 
per  cent ; 

8.  .  Gross  premiums  (without  any  deduction)  received 
and  receivable  upon  all  unexpired  fire  risks  running  more 
than  one  year  from  date  of  policy  —  reinsurance  thereon 
pro  rata  ; 

9.  Gross  premiums  (without  any  deductions)  received 
and  receivable  upon  all  unexpired  marine  and  inland  naviga- 
tion risks,  except  time  risks — reinsurance  thereon  at  one 
hundred  per  cent.; 

,  10.  Gross  premiums  (without  any  deductions)  received 
and  receivable  on  marine  time  risks — reinsurance  thereon  at 
fifty  per  cent ; 

W.  Amount  reclaimable  by  the  insured  on  perpetual  fire 
insurance  policies,  being  ninety-five  per  cent,  of  the  premium 
or  deposit  received ; 

12.     Reinsurance    fund  and  all  other  liabilities,  except 
4 


38  POLITICAL   CODE. 

same.  capital,  under  the  life  insurance  or  any  other  special  depart- 

ment ; 

13.  Unused  balances  of  bills  and  notes  taken  in  advance 
for  premiums  on  open  marine  and  inland  policies  or  otherwise, 
returnable  on  settlement ; 

14.  Principal  unpaid  on  scrip  or  certificates  or  profits 
which  have  been  authorized  or  ordered  to  be  redeemed ; 

15.  Amount  of  all  other  liabilities  of  the  company,  specify- 
ing the  same. 

Fourth. 

The  income  of  the  company  during  the  preceding  year, 
specifying : 

1.  The  amount  of  cash  premiums  received  ; 

2.  The  amount  of  notes  received  for  premiums  ; 

3.  The  amount  of  interest  money  received,  specifying  the 
same ; 

4.  The  amount  of  income  received  from  all  other  sources, 
specifying  the  same. 

Fifth. 

The  expenditures  during  the  preceding  year,  specifying : 

1.  The  amount  of  losses  paid  ; 

2.  The  amount  of  dividends  paid  ; 

3.  The  amount  of  expenses  paid,  including  commissions 
and  fees  to  agents  and  officers  of  the  company  ; 

4.  The  amount  paid  for  taxes  ; 

5.  The  amount  of  all  other  payments  and  expenditures. 

Sixth. 

1.  The  amount  of  risks  written  during  the  year ; 

2.  The  amount  of  risks  expired  during  the  year  ; 

3.  The  amount  of  risks  written  during  the  year  in  the 
State  of  California  ; 

4.  The  amount  of  premiums  thereon. 


INSURANCE   COMMISSIONER.  39 

Sec.  613.     Such  statement,  if  made  by  life,  health,  and  Same 
accident  companies  must  show  : 

First 

The  amount  of  the  capital  stock  of  the  company. 

Second. 

The  property  or  assets  held  by  the  company,  specifying : 

1.  The  value  of  the  real  estate  held  by  the  company  ; 

2.  The  amount  of  cash  on  hand  and  deposited  in  banks  to 
the  credit  of  the  company,  specifying  the  same  ; 

3.  The  amount  of  loans  secured  by  bond  and  mortgage 
on  real  estate,  specifying  the  same ; 

4.  Amount  of  loans  secured  by  pledge  of  bonds,  stocks, 
or  other  marketable  securities  as  collateral,  specifying  the 
same ; 

5.  Cash  market  value  of  all  stocks  and  bonds  owned  by 
the  company,  specifying  the  same  ; 

6.  Interest  due  the  company  and  unpaid  ; 

7.  Interest  accrued  but  not  due  ; 

8.  Premium  notes  and  loans  in  any  form  taken  in  pay- 
ment of  premiums  on  policies  now  in  force ; 

9.  Gross  amount  of  premiums  in  process  of  collection  and 
transmission  on  policies  in  force  ; 

10.  Gross  amount  of  deferred  premiums  ; 

11.  All  other  assets,  specifying  the  same. 

Third — Liabilities. 

1.  Claims  for  death  losses  and  matured  endowments,, 
due  and  unpaid  ; 

2.  Claims  for  death  losses  and  matured  endowments  in 
process  of  adjustment  or  adjusted  and  not  due  ; 

3.  Claims  resisted  by  the  company; 

4.  Amounts  due  and  unpaid  on  annuity  claims  ; 

5.  Trust  fund,  on  deposit,  or  net  present  value  of  all  the 
outstanding  policies,   computed  according  to  the  American 


40  POLITICAL  CODE. 

•  Experience  Tables  of  mortality,  with  four  and  one  half  per 
cent,  interest; 

6.  Additional  trust  fund  on  deposit,  or  net  present  value 
of  extra  and  special  risks,  including  those  on  impaired  lives ; 

7.  Amount  of  all  unpaid  dividends  of  surplus  percentages, 
bonuses,  and  other  description  of  profits  to  policy-holders,  and 
interest  thereon ; 

8.  Amount  of  any  other  liability  to  policy-holders  or  an- 
nuitants not  included  above ; 

9.  Amount  of  dividends  unpaid  to  stockholders ; 

10.  Amount  of  National,  State,  and  other  taxes  due  ; 

11.  All  other  liabilities,  specifying  the  same. 

Fourth — Income. 

1.  Cash  received  for  premiums  on  new  policies  during 
the  year; 

2.  Cash  received  for  renewal  of  premiums  during  the 
year ; 

3.  Cash  received  for  sale  of  annuities  ; 

4.  Cash  received  for  all  other  premiums  ; 

5.  Cash  received  for  interest  on  loans,  specifying  the 
same; 

6.  Rents  received; 

7.  Cash  received  from  all  other  sources,  specifying  the 
same. 

8.  Gross  amount  of  notes  taken  on  account  of  new  pre- 
miums ; 

9.  Gross  amount  of  notes  taken  on  account  of  renewal 
premiums. 

Fifth — Expenditures. 

1 .  Cash  paid  for  losses  ; 

2.  Cash  paid  to  annuitants  ; 

3.  Cash  paid  for  lapsed,  surrendered,  and  purchased  pol- 
icies ; 

4.  Cash  paid  for  dividends  to  policy-holders  ; 


INSURANCE   COMMISSIONER.  41 

5.  Cash  paid  for  dividends  to  stockholders  ;  Same- 

6.  Cash  paid  for  reinsurances  ; 

7.  Commission  paid  to  agents  ; 

8.  Salaries  and  other  compensation  of  officers  and  em- 
ploye's, except  agents  and  medical  examiners  ; 

9.  Medical  examiners'  fees  and  salaries  ; 

10.  Cash  paid  for  taxes ; 

11.  Cash  paid  for  rents  ; 

12.  Cash  paid  for  commuting  commissions; 

13.  All  other  cash  payments. 

Sixth. 
Balance  sheet  of  premium  note  account. 

Seventh. 
Balanee  sheet  of  all  the  business  of  the  company. 

Eighth. 

1.  Total  amount  of  insurance  effected  during  the  year  on 
new  policies ; 

2.  Total  amount  of  insurance  effected  during  the  year  in 
the  State  of  California  ; 

3.  Premiums  received  during  the  year  on  risks  written  in 
the  State  of  California. 

Sec.  614.  Mutual  companies  formed,  existing,  and  doing  stoeknotcs, 
business  under  an  Act  entitled  "  An  Act  to  provide  for  the  puted- 
incorporation  of  mutual  insurance  companies,"  passed  April 
twenty-sixth,  eighteen  hundred  and  fifty-one,  may  report  their 
approved  stock  notes  as  capital  paid  up,  and  such  notes  for 
all  purposes  must  be  deemed  part  of  the  paid  up  capital  stock 
of  such  corporation. 


Sec.  615.  The  Insurance  Commissioner  must  cause  to  be 
prepared,  and  furnish  to  each  person  and  to  each  of  the  com- 
panies incorporated  in  this  State,  and  to  the  attorney  of  each 


To  furnish 
blanks. 


42 


POLITICAL   CODE. 


of  the  companies  incorporated  or  chartered  by  other  States 
and  foreign  governments,  printed  forms  of  the  statements 
herein  required ;  and  he  may  make  such  changes  from  time 
to  time  in  the  form  of  the  same  as  seems  to  him  best  adapted 
to  elicit  from  the  companies  a  true  exhibit  of  their  condition 
in  respect  to  the  several  points  hereinbefore  enumerated. 
The  same  forms  must  be  addressed  to  all  persons  and  com- 
panies engaged  in  the  same  kind  of  business. 


Agent  upon 
whom  pro- 
cess may  be 
served. 


Foreign  in- 
surancecora- 
panies,  con- 
ditions prec- 
edent. 


Sec.  616.  The  Insurance  Commissioner  must  require  as 
a  condition  precedent  to  the  transaction  of  insurance  business 
in  this  State  by  any  foreign  corporation,  that  such  corporation 
must  file  in  his  office  the  name  of  an  agent,  and  his  place  of 
residence  in  this  State,  on  whom  summons  and  other  pro- 
cess may  be  served  in  all  actions  or  other  legal  proceedings 
against  such  corporation.  All  process  so  served  gives  juris- 
diction over  the  person  of  such  corporation. 

[Amended.] 

Section  1.  Section  616  of  the  Political  Code  of  the 
State  of  California  is  amended  so  as  to  read  as  follows : 

Sec.  616.  The  Insurance  Commissioner  must  require,  as 
a  condition  precedent  to  the  transaction  of  insurance  business 
in  this  State  by  any  foreign  corporation  or  company,  that  such 
corporation  or  company  must  file  in  his  office  the  name  of  an 
agent,  and  his  place  of  residence  in  this  State,  on  whom  sum- 
mons and  other  process  may  be  served  in  all  actions  or  other 
legal  proceedings  against  such  corporation  or  company.  All 
process  so  served  gives  jurisdiction  over  the  person  of  such 
corporation  or  company.  The  agent  so  appointed  and  des- 
ignated shall  be  deemed  in  law  a  general  agent,  and  must  be 
the  principal  agent  or  chief  manager  of  the  business  of  such 
corporation  or  company  in  this  State.  Any  act,  statement, 
representation,  or  agreement,  done  or  made  by  an  agent  so 
appointed  and  designated,  which  in  any  manner  pertains  to  the 
business  of  such  corporation  or  company,  shall  be  deemed  the 
act,  statement,  representation,  or  agreement  of  the  principal, 
and  shall  have  the  same  force  and  effect  as  if  done  or  made  by 
the  principal.  Any  such  foreign  corporation  or  company  shall, 
as  a  further  condition  precedent  to  the  transaction  of  insurance 


INSURANCE   COMMISSIONER.  43 

business  in  this  State,  and  in  consideration  of  the  privilege  to 
transact  such  insurance  business  in  this  State,  make  and  file 
with  the  Insurance  Commissioner,  an  agreement  or  stipula- 
tion, executed  by  the  proper  authorities  of  such  corporation 
or  company,  in  form  and  substance  as  follows :  "  The  (giving  Form  of 
name  of  corporation  or  company)  does  hereby  stipulate  and 
agree,  that  in  consideration  of  the  permission  granted  by  the 
State  of  California  to  it,  to  transact  insurance  business  in 
that  State,  that  in  all  litigation  between  (giving  name  of  cor- 
poration or  company),  and  any  citizen  of  the  State  of  Califor- 
nia, the  Courts  of  said  State  shall  have  and  maintain  exclus- 
ive jurisdiction  of  such  litigation.  And  it  is  further  agreed 
that  no  action  hereafter  commenced  in  any  District  Court  of 
said  State  of  California  against  (insert  name),  shall  be  re- 
moved or  transferred  therefrom  to  the  United  States  Circuit 
Court."     If  in  any  action  hereafter  commenced  in  any  Dis-  Penalty  for 

r-t  •       o  •  •  o  c  violation- 

tnct  Court  of  this  State,  by  a  citizen  thereof,  against  a  for- 
eign corporation  or  company  doing  insurance  business  in  said 
State,  such  corporation  or  company  shall  transfer,  or  cause  to 
be  transferred,  such  action,  to  the  United  States  Circuit 
Court,  the  right  of  such  corporation  or  company  to  transact 
insurance  business  in  said  State  shall  thereupon  and  thereby 
cease  and  determine  ;  and  the  Insurance  Commissioner  shall 
immediately  revoke  the  certificate  of  such  corporation  or  com- 
pany, authorizing  it  to  do  business  in  said  State  of  California. 
Approved  March  28th,  1874. 


er  when 
companies 
fail  to  make 
statement. 


Sec.  617.     The  Commissioner  must  collect  the  sum  of  five  Duties  of 

Commission' 

hundred  dollars  from  any  person  or  corporation  engaged  in 
the  business  of  insurance,  for  a  failure  to  make  and  deposit 
in  his  office  the  statements  provided  for  in  the  eight  preced- 
ing sections,  and  an  additional  penalty  of  one  thousand  dollars 
for  each  and  every  month  thereafter  that  such  person  or  cor- 
poration continues  to  transact  the  business  of  insurance  until 
such  certificate  and  statement  is  filed,  and  for  that  purpose 
suits  may  be  instituted  in  the  name  of  the  People  of  the  State 
of  California  in  any  Court  of  competent  jurisdiction. 

[Amended.] 

Sec.  2.     Section  617  of  the  Political  Code  of  the  State 
of  California  i3  amended  so  as  to  read  as  follows : 


44  POLITICAL    CODE. 

Siimo.  gEC>  fiiy      The  Commissioner  must  collect  the  sum  of  one 

thousand  dollars  from  any  corporation  or  company  engaged 
in  the  business  of  insurance,  for  a  failure  to  make  and  de- 
posit in  his  office,  within  ninety  days  after  being  thereto  re- 
quested by  said  Commissioner,  the  statements  and  stipulations 
provided  for  in  the  eighth  preceding  section  and  the  last  pre- 
ceding section ;  and  an  additional  penalty  of  two  thousand 
dollars  for  each  and  every  month  thereafter  that  such  corpora- 
tion or  company  continues  to  transact  the  business  of  insur- 
ance, until  such  certificate,  statement,  and  stipulations  are 
filed ;  and  for  that  purpose  suit  may  be  instituted  in  the  name 
of  the  People  of  the  State  of  California,  in  any  Court  of  com- 
petent jurisdiction.  The  Insurance  Commissioner  shall,  im- 
mediately after  the  passage  of  this  Act,  give  due  notice  of  its 
provisions  to  all  foreign  insurance  corporations  or  companies 
doing  or  proposing  to  do  business  in  this  State. 

Sec.  8.  All  Acts  or  parts  of  Acts,  inconsistent  with  the 
provisions  of  this  Act,  are  hereby  repealed.  This  Act  shall 
take  effect  and  be  in  force  from  and  after  its  passage. 

Approved  March  28th,  1874. 

Deposits  and       Sec.  618.     Whenever  the  laws  of  any  State  of  the  United 

dividends.  .  .  . 

States  require  any  life  insurance  company  incorporated  by 
or  organized  under  the  laws  of  this  State,  to  deposit  with 
some  officer  of  this  State  securities  in  trust  for  or  for  the 
benefit  of  the  policy-holders  of  such  corporation  as  a  prereq- 
uisite to  transacting  business  in  such  other  State,  the  Com- 
missioner of  this  State  must  receive  from  such  life  insurance 
corporation  securities  of  the  amount  required  by  the  laws  of 
such  other  State,  on  deposit  and  in  trust  for  the  policy-holders 
of  such  corporation,  the  value  of  which  must  be  equal  to  the 
value  of  interest- bearing  stocks,  bonds,  or  other  securities  of 
the  United  States.  He  must,  upon  the  receipt  of  the  securi- 
ties, forthwith  make  a  special  deposit  in  the  State  Treasury 
of  the  same,  in  packages  marked  with  the  name  of  the  cor- 
poration from  whom  received,  where  they  must  remain  as 
security  for  policy-holders  in  the  corporation  to  which  they 
respectively  belong;  but  so  long  as  any  corporation  so  de- 
positing continues  solvent,  he  must  permit  such  corporation 
to  collect  the  interest  or  dividends  on  its  securities  so  de- 


INSURANCE   COMMISSIONER.  45 

posited,  and  from  time  to  time  to  withdraw  any  such  securi- 
ties on  depositing  other  securities  in  the  stead  of  those  to  be 
withdrawn,  such  new  securities  to  be  of  the  same  value  men- 
tioned in  this  chapter ;  but  such  securities  must  not  be  with- 
drawn from  the  State  Treasury  unless  upon  the  written  order 
of  the  acting  President  and  Secretary  of  the  corporation 
making  the  deposits,  which  order  must  be  endorsed  by  the 
Commissioner,  or  upon  the  order  and  authority  of  some  Court 
of  competent  jurisdiction. 

Sec.  619.  Whenever  any  life  insurance  corporation,  JJJPgfgJ nv 
organized  under  the  laws  of  this  State,  has  deposited  with 
the  Commissioner  the  requisite  securities,  in  conformity  with 
the  laws  of  the  State  in  which  such  corporation  is  desirous  of 
transacting  its  business,  he  must  issue  to  such  corporation  a 
certificate,  under  his  official  seal,  of  such  deposit,  for  each 
State  requiring  the  same,  which  must  state  the  items  and 
amount  of  securities  thus  deposited,  and  that  they  are  of  the 
market  value  represented  therein ;  but  no  securities  must  be 
estimated  above  the  par  value  of  the  same. 

Sec.  620.  Whenever  any  life  insurance  corporation  has  Deposits  .e- 
so  deposited  its  securities,  and  has  paid,  cancelled,  or  rein-  when. ' 
sured  all  its  unexpired  policies,  and  all  its  liabilities  under 
such  policies  are  extinguished  or  assumed  by  other  re- 
sponsible corporations  having  a  similar  deposit  with  the  Com- 
missioner, then  if,  on  application  of  such  corporation,  verified 
by  the  oath  of  its  President  and  Secretary,  and  from  an  ex- 
amination of  the  books  of  the  corporation  and  of  its  officers 
under  oath,  the  Insurance  Commissioner  is  satisfied  that  all 
of  its  policies  are  so  paid,  cancelled,  extinguished,  or  rein- 
sured, he  must  deliver  up  to  the  corporation  the  securities 
deposited. 


Sec  621.  The  Comissioner  must  make  an  annual  ex- 
amination of  the  securities  received  by  him  from  each  life  in- 
surance corporation ;  and  if  it  appear  at  any  time  that  the 


Examination 
of  securities. 


clause. 


46  POLITICAL   CODE. 

securities  deposited  by  any  corporation  amount  to  less  than 
the  sum  required  for  the  purposes  for  which  the  deposit  was 
made,  he  must  notify  the  corporation  thereof ;  and  unless  the 
deficiency  is  made  up  within  thirty  days  after  notice,  the 
Commissioner  must  countermand  all  the  certificates  he  may 
have  issued  to  the  corporation  under  this  chapter,  and  give 
notice  thereof  to  the  officers  of  the  several  States  to  whom 
the  certificate  may  have  been  transmitted  ;  and  he  must  also 
publish  the  notice  for  three  weeks  successively  in  one  daily 
newspaper  printed  in  the  City  of  Sacramento  and  one  daily 
newspaper  printed  in  the  City  of  San  Francisco,  at  the  ex- 
pense of  the  corporation,  collected  by  assessment. 

Retaliatory  Sec.  622.  Whenever  the  laws  of  any  State  of  the  United 
States  require  of  insurance  companies  incorporated  under  the 
laws  of  this  State  and  having  agencies  in  such  other  State,  or 
of  the  agents  thereof,  any  further  or  greater  license,  fees, 
charges,  impositions,  taxes,  deposit  of  securities,  statements, 
publications  or  certificates  of  authority,  or  inflict  any  greater 
fines  or  penalties  upon  such  corporations  or  agents  than  are 
required  from  similar  companies  or  agents  of  other  States 
doing  business  in  this  State,  then  and  in  every  such  case, 
from  every  company,  person,  or  corporation  of  such  other 
State  which  has  or  is  about  to  establish  agencies  in  this  State, 
the  Commissioner  must,  before  it  continues  or  commences  to 
do  business  in  this  State,  collect  the  same  license,  fees,  charges, 
impositions,  and  taxes,  and  require  the  same  statements, 
publications,  certificates  of  authority,  and  the  same  deposit  of 
securities  as  are  required  by  the  laws  of  such  State  of  similar 
companies,  persons,  or  corporations,  and  agents,  of  this 
State,  doing  business  in  such  other  State ;  and  the  same 
fines  and  penalties  must  be  inflicted  upon  companies,  per- 
sons, or  corporations  of  such  other  States,  and  their  agents, 
as  are  inflicted  by  such  States  upon  companies,  persons,  or 
corporations  of  this  State,  and  their  agents,  under  the  laws  of 
such  other  States. 


INSURANCE    COMMISSIONER.  47 

[Amended.] 

Sec.  18.     Section  622  of  said  Code  is  amended  to  read  as  same. 
follows : 

Sec.  622.  Whenever  the  laws  of  any  State  or  country 
require  of  insurance  companies,  incorporated  under  the  laws 
of  this  State,  and  having  agencies  in  such  other  State  or 
country,  or  of  the  agents  thereof,  any  further  or  greater 
license,  fees,  charges,  impositions,  taxes,  deposit  of  securities, 
statements,  publications,  or  certificates  of  authority,  or  inflict 
any  greater  fines  or  penalties  upon  such  corporations  or 
agents  than  are  required  from  similar  companies  or  agents 
belonging  to  such  State  or  country  respectively,  then  and 
in  every  such  case,  from  every  company,  person,  or  corpora- 
tion of  such  State  or  country,  which  has  or  is  about  to 
establish  agencies  in  this  State,  the  Commissioner  must,  before 
it  continues  or  commences  to  do  business  in  this  State,  collect 
the  same  licenses,  fees,  charges,  impositions,  and  taxes  u  as 
are  imposed  by  such  State  upon  agents,  companies,  corpora- 
tions, or  persons  of  this  State  doing  business  in  such  State, 
in  excess  of  the  licenses,  fees,  charges,  impositions,  and  taxes 
upon  agents,  companies,  corporations,  or  persons  of  that 
State,"  and  require  the  same  statements,  publications,  certifi- 
cates of  authority,  and  the  same  deposit  of  securities,  as  are 
required  by  the  laws  of  such  State  or  country  of  companies, 
persons,  or  corporations  and  agents  of  this  State  doing  busi- 
ness in  such  other  State  or  country  ;  and  the  same  fines  and 
penalties  must  be  inflicted  upon  companies,  persons,  or  cor- 
porations of  such  other  State  or  country,  and  their  agents,  as 
are  inflicted  by  the  laws  of  such  State  or  country  upon  com- 
panies, persons,  or  corporations  of  this  State,  and  their  agents, 
in  excess  of  such  fines  and  penalties  inflicted  upon  companies, 
persons,  or  corporations  belonging  to  such  State  or  country 
respectively  which  may  be  recovered  by  the  Insurance  Com- 
missioner in  the  manner  provided  in  Section  598  of  this  Code. 

Approved  March  30th,  1874. 


Sec.  623.  The  Commissioner  must  require  every  com- 
pany, association,  or  individual,  not  incorporated  under  the 
laws  of  this  State,  and  proposing  to  transact  insurance 
business  by  agent  or  agents  in  this  State,  before  commencing 
such  business  to  file  in  his  office  a  bond,  to  be  signed  by  the 
person  or  firm,  officer  or  agent,  as  principal,  with  two  sureties, 


Honds  from 
foreign  cor 
porations. 


48  POLITICAL   CODE. 

to  be  approved  by  the  Commissioner,  in  the  penal  sum  of  two 
thousand  dollars  for  each  insurance  company,  association, 
firm,  or  individual  for  whose  account  it  is  proposed  to  collect 
premiums  of  insurance  in  this  State,  the  conditions  of  such 
bonds  to  be  as  follows  : 

1.  That  the  person  or  firm,  agent  or  officer,  named  there- 
in, acting  on  behalf  of  the  company,  association,  firm,  or  in- 
dividual named  therein,  will  pay  to  the  Treasurer  of  the 
county,  or  city  and  county,  in  which  the  principal  office  of 
the  agency  is  located,  such  sum  per  quarter,  quarterly  in 
advance,  for  a  license  to  transact  an  insurance  business,  or 
such  other  license  as  may  be  imposed  by  law  so  long  as  the 
agency  remains  in  the  hands  of  the  person  or  firm,  officer  or 
agent,  named  as  principal  in  the  bond  ; 

2.  That  the  person  or  firm,  officer  or  agent,  will  pay  to 
the  State  all  stamp  or  other  duties  on  the  gross  amount  in- 
sured by  them,  in  the  manner  and  at  the  time  prescribed  by 
law,  inclusive  of  renewals  on  existing  policies  ; 

3.  That  the  person,  firm,  agent,  or  corporation  named 
therein  will  conform  to  all  the  provisions  of  the  revenue  and 
other  laws  made  to  govern  them. 

same.  Sec.  624.     Whenever  the  same  person,  firm,  officer,  or 

agent  desires  to  collect  premiums  of  insurance  for  more  than 
one  company,  association,  or  individual,  not  incorporated  under 
the  laws  of  this  State,  the  Commissioner  must  require  a 
separate  bond,  as  provided  in  the  preceding  section,  for  each 
company  or  association  so  represented  by  such  person,  firm, 
officer,  or  agent. 


Commission 


information. 


Sec.  625.     The  Commissioner  must,  before  the  commence- 
Asseslor111811  ment  of  each  fiscal  year  as  fixed  in  the  revenue  laws,  furnish 

with  certain  .  .  .       _,  _ 

the  Assessor  of  the  county  in  which  the  principal  office  ot  any 
person  or  corporation  doing  business  of  insurance  is  situated, 
all  the  data  concerning  premiums  collected  by  and  all  other 
necessary  information  in  relation  to  the  business  of  such  per- 


INSURANCE    COMMISSIONER.  49 

son  or  corporation  as  will  assist  the  Assessor  in  the  perform- 
ance of  his  duties. 


Securities. 


Sec.  626.  The  Commissioner  must  require  from  every 
person,  before  and  after  engaging  in  the  business  of  insur- 
ance, a  full  compliance  with  all  the  provisions  of  Title  II, 
Part  IV,  Division  I,  of  the  Civil  Code  applicable  thereto ; 
and  every  person  neglecting  to  comply  with  such  require- 
ments is  subject  to  the  fines  and  penalties  therein  prescribed. 

Sec  627.     All  statements,  estimates,  percentages,  pay-  statements 
ments,  and  calculations,  required  by  this  Chapter  to  be  made,  y^ue?005" 
either  by  the  Commissioner  or  persons  engaged  in  the  busi- 
ness of  fire  or  marine  insurance,  must  be  in  gold  coin  of  the 
United  States. 

Sec.  628.     The  annual  salary  of  the  Insurance  Commis-  salary. 
sioner  is  three  thousand  dollars. 


Sec.  629.     The  annual  salary  of  the  Deputy  of  the  Com- 
missioner of  Insurance  is  eighteen  hundred  dollars. 


Salary  of 
Deputy. 


o 


Sec.  630.     The  Commissioner  may  procure  rooms  for  his  conttngen 

rr*  t  r»  t    n  Expenses. 

office  at  a  rent  not  to  exceed  seventy-five  dollars  per  month, 
and  may  provide  a  suitable  safe  and  furniture  therefor ;  he 
may  also  provide  stationery,  fuel,  printing,  and  other  conven- 
iences necessary  for  the  transaction  of  the  business  of  his 
office.  All  expenditures  authorized  in  this  section  must  be 
audited  by  the  Board  of  Examiners,  and  paid  in  the  same 
manner  as  the  salary  of  the  Commissioner. 


Sec.  631.     The  Commissioner  must  keep  his  office  in  the   L 
City  of  San  Francisco. 


ocation  of 


Sec.  632.     The   Commissioner  must   execute  an  official  official  bond, 
bond  in  the  sum  of  ten  thousand  dollars. 


50 


POLITICAL    CODE. 


Licensing 
insurance 
agents. 


Section  1.  The  Political  Code  of  the  State  of  Califoraia 
is  hereby  amended  by  adding  thereto  an  additional  section, 
to  be  called  Section  633,  and  which  shall  read  as  follows  : 

Sec.  633.  No  person  shall,  in  this  State,  act  as  the  agent 
or  solicitor  of  any  life  insurance  company  doing  business  in 
this  State,  until  he  has  produced  to  the  Commissioner,  and 
filed  with  him,  a  duplicate  power  of  attorney  from  the  com- 
pany or  its  authorized  agent,  authorizing  him  to  act  as  such 
agent  or  solicitor.  Upon  filing  such  power  the  Commissioner 
shall  issue  a  license  to  him  to  act  as  such  agent  or  solicitor 
for  such  company,  if  such  company  has  received  a  certificate 
of  authority  from  such  Commissioner  to  do  business  in  this 
State  ;  provided,  that  if  such  agent  or  solicitor  shall,  within 
the  twelve  months  next  preceding,  have  been  in  the  employ 
of  any  other  company  or  its  authorized  agent,  as  such  agent 
or  solicitor,  he  must  produce  to  the  Commissioner  written  evi- 
dence from  such  employer  that  all  moneys  he  may  have  col- 
lected for  such  company  or  agent  have  been  paid  over  to  said 
company  or  agent.  Such  license  shall  continue  in  force  for 
twelve  months  from  the  date  thereof,  but  may  be  and  shall 
be  sooner  revoked  upon  application  of  the  company  or  its  au- 
thorized agent.  Such  license  may  be  renewed  from  time  to 
time,  for  an  additional  period  of  twelve  months,  on  production 
by  the  holder  to  the  Commissioner  of  a  certificate  from  the 
company  that  such  person's  authority  as  such  agent  or  solici- 
tor continues.  For  each  such  license,  or  renewal  thereof,  the 
Commissioner  shall  receive  the  sum  of  one  dollar.  The  Com- 
missioner shall  keep  an  alphabetical  list  of  the  names  of  per- 
sons to  whom  such  license  shall  be  issued,  with  the  date  of  the 
license  and  renewal,  and  the  name  of  the  company  for  which 
such  person  is  working.  If  any  person  shall  fraudulently 
assume  to  be  an  authorized  agent  or  solicitor  of  any  life  in- 
surance company,  and  thus  procure  or  attempt  to  procure 
applications,  or  receive  or  attempt  to  obtain  money  for  pre- 
miums, he  shall  be  guilty  of  a  misdemeanor.  If  any  person 
shall,  under  a  false  or  fictitious  name,  procure  or  attempt  to 
procure  a  license  to  act  as  agent  or  solicitor  of  any  life  insur- 
ance company,  he  shall  be  guilty  of  a  misdemeanor. 

Approved  "March  12th,  1874. 


Repealed. 
Rights  main- 
tained. 


Sec.  116.  All  provisions  of  law  inconsistent  with  the  pro- 
visions of  this  Act  are  hereby  repealed  ;  but  no  rights  ac- 
quired or  proceedings  taken  under  the  provisions  repealed 


INSURANCE   COMMISSIONER. 


51 


shall  be  impaired  or  in  any  manner  affected  by  this  repeal ; 
and  whenever  a  limitation  or  period  of  time  prescribed  by  Limitation?, 
such  repealed  provisions  for  acquiring  a  right  or  barring  a 
remedy,  or  for  any  other  purpose,  has  begun  to  run  before  this 
Act  takes  effect,  and  the  same  or  any  other  limitation  is  pre- 
scribed by  this  Act,  the  time  which  shall  have  run  when  this 
Act  takes  effect  shall  be  deemed  part  of  the  time  prescribed 
by  this  Act. 


Sec.  117.  With  relation  to  the  laws  passed  at  the  pres- 
ent session  of  the  Legislature,  this  Act  must  be  construed  as 
though  it  had  been  passed  on  the  first  day  of  the  present 
session ;  and  if  any  of  the  provisions  of  this  Act  contravene 
or  are  inconsistent  with  the  provisions  of  any  law  passed  at 
the  present  session  of  the  Legislature,  then  the  provisions  of 
such  law  must  prevail. 


Construction 
of  Act. 


Sec.  118.  This  Act  shall  take  effect  on  the  first  Monday  Totakeeffe< 
of  July,  one  thousand  eight  hundred  and  seventy- four,  except 
so  much  thereof  as  relates  to  immigration,  and  the  authority 
and  duties  of  the  Commissioner  of  Immigration,  and  the  en- 
forcement of  the  duties  and  penalties  therein  prescribed, 
which  shall  take  effect  immediately  after  its  enactment. 

Approved  March  30th,  1874. 


PART   V 

TITLE  II. 

EFFECT   OF   THE    CODES. 


(.Construc- 
tion of  the 
(Codes  with 
relation  to 
the  laws 
passed  at 
the  present 
session. 


Section  4478.     Construction  of  the  Codes  with  relation  to  the  laws  passed 
at  the  present  session. 
44*79.     Laws  passed  at  the  present  session  prevail. 

Section  4478.  With  relation  to  the  laws  passed  at  the 
present  session  of  the  Legislature,  the  Political  Code,  Civil 
Code,  Code  of  Civil  Procedure,  and  Penal  Code,  must  be 
construed  as  though  each  had  been  passed  on  the  first  day 
of  the  present  session. 


Laws  passed       ^ec     4479.     If  the  provisions  of  any  law  passed  at  the 

at  the  pres-  j.#'/»j.it,ij.  • 

ent session      present  session  ot  the  Legislature  contravene  or  are  incon- 
sistent with  the  provisions  of  either  of  the  four  Codes,  the 


provisions  of  such  law  must  prevail. 
Approved  March  12th,  1872. 


FOREIGN   CORPORATIONS.  53 


AN  ACT  in  relation  to  Foreign  Corporations. 

[Approved  April  1,  1872.] 
[Enacting  clause.] 

Section  1.  Every  corporation  heretofore  created  by  the 
laws  of  any  other  State  and  doing  business  in  this  State,  shall, 
within  one  hundred  and  twenty  days  after  the  passage  of  this 
Act,  and  any  corporation  hereafter  created  and  doing  busi- 
ness in  this  State,  within  sixty  days  from  the  time  of  com- 
mencing to  do  business  in  this  State,  designate  some  person 
residing  in  the  county  in  which  the  principal  place  of  business 
of  said  corporation  in  this  State  is,  upon  whom  process  issued 
by  authority  of  or  under  any  law  of  this  State  may  be  served, 
and  within  the  time  aforesaid  shall  file  such  designation  in  the 
office  of  the  Secretary  of  State  ;  and  a  copy  of  such  designa- 
tion, duly  certified  by  said  officer,  shall  be  evidence  of  such 
appointment ;  and  it  shall  be  lawful  to  serve  on  such  person 
so  designated  any  process  issued  aforesaid.  Such  service 
shall  be  made  on  such  person  in  such  a  manner  as  shall  be 
prescribed  in  case  of  service  required  to  be  made  on  foreign 
corporations,  and  such  service  shall  be  deemed  to  be  a  valid 
service  thereof. 

Sec.  2.  Every  corporation  created  by  the  laws  of  any 
other  State  which  shall  fail  to  comply  with  the  provisions  of 
the  first  section  of  this  statute,  shall  be  denied  the  benefit  of 
the  statutes  of  this  State  limiting  the  time  for  the  commence- 
ment of  civil  actions. 

Sec  3.  Every  corporation  created  by  the  laws  of  any 
other  State  which  shall  comply  with  the  provisions  of  the  first 
section  of  this  statute,  shall  be  entitled  to  the  benefit  of  the 
statutes  of  this  State  limiting  the  time  for  the  commencement 
of  civil  actions. 
5 


54 


LIFE   INSURANCE   POLICIES. 


Non-forfeit- 
ure of  life 


insured  by 
home  com- 
panies. 


Net  value, 
how  ascer 
tained. 


Considered 
premium 
for  tempo- 
rary insur 
.ance. 


Policy  must 
be  paid  if 
death  occur 
within  term 
of  temporary 
insurance. 


AN  ACT  to    Regulate  the  Forfeiture  of  Policies  of  Life 
Insurance. 

[Approved  February  2,  1872.] 

Section  1.  No  policy  of  insurance  on  life  hereafter  is- 
sued by  any  company  incorporated  under  the  laws  of  this 
State,  shall  be  forfeited  or  become  void  by  the  non-payment 
of  premiums  thereon,  any  further  than  regards  the  right  of 
the  party  insured  therein  to  have  it  continued  in  force  be- 
yond a  certain  period,  to  be  determined  as  follows,  to  wit : 
The  net  value  of  the  policy  when  the  premium  becomes 
due,  and  is  not  paid,  shall  be  ascertained  according  to  the 
American  Experience  Life  Table  rate  of  mortality,  with  inter- 
est at  four  and  a  half  per  centum  per  annum,  or  the  same  in- 
terest which  has  been  assumed  in  finding  the  net  value  of  the 
policy.  After  deducting  from  such  net  value  any  indebted- 
ness to  the  company  or  notes  held  by  the  company  against 
the  insured,  which  notes,  if  given  for  premium,  shall  then  be 
cancelled,  four  fifths  of  what  remains  shall  be  considered  as  a 
aaet  single  premium  of  temporary  insurance,  and  the  term  for 
which  it  will  insure  shall  be  determined  according  to  the  age 
of  the  party  at  the  time  of  the  lapse  of  premium  and  the  as- 
sumption of  mortality  and  interest  aforesaid. 

Sec  2.  If  the  death  of  the  party  occur  within  the  term 
of  temporary  insurance  covered  by  the  value  of  the  policy,  as 
determined  in  the  previous  section,  and  if  no  condition  of  the 
insurance  other  than  the  payment  of  the  premium  shall  have 
been  violated  by  the  insured,  the  company  shall  be  bound  to 
pay  the  amount  of  the  policy  in  the  same  as  if  there  had 
been  no  lapse  of  premium,  anything  in  the  policy  to  the  con- 
trary notwithstanding  ;  provided,  however,  that  notice  of  the 


VALUATION   OF   LIFE   INSURANCE   POLICIES.  55 

claim  and  proofs  of  death  shall  be  submitted  to  the  company 
within  six  months  of  the  decease  ;  and  provided  also,  that  the 
company  shall  have  the  right  to  deduct  from  the  amount  in- 
sured in  the  policy,  the  amount,  at  ten  per  centum  per  an- 
num, of  the  premium  that  has  been  foreborne  at  the  time  of 
the  death. 

Sec.  3.     This  Act  shall  take  effect  immediately. 


AN  ACT  to  amend  an  Act  entitled  an  Act  to  provide 
for  Official  Valuation  of  Life  Insurance  Policies, 
approved  April  fourth,  one  thousand  eight  hundred 
and  seventy. 

[Approved  February  13,  ,1872.] 

The    People    of  the  State    of    California,   represented  in 
Seriate  and  Assembly,  do  enact  as  fol'.ows : 

1.  Valuation  of  policies. 
Interest. 

Actuary. 

2.  Insurance  Commissioner. 

Section  1.  Section  one  of  said  Act  is  hereby  amended 
so  as  to  read  as  follows : 

Sec.  1.  Every  life  insurance  company  organized  under 
the  laws  of  this  State  shall,  on  or  before  the  first  Monday 
in  January  of  each  year,  furnish  the  Insurance  Commis- 
sioner the  data  necessary  for  determining  the  valuation  of  all 
its  policies  outstanding  on  the  thirty-first  day  of  December 
next  preceding,  which  said  valuation  shall  be  based 
upon  the  rate  of  mortality  as  established  by  the  Amer- 
ican Experience  Tables  of  Mortality.  The  rate  of  in- 
terest to  be  assumed  shall  be  at  the  option  of  the  company ; 


Valuation  of 
policies. 


Interest. 


M  VALUATION   OF   LIFE   INSURANCE   POLICIES. 

provided,  that  the  same  shall  not  be  less  than  four  and  one 
half  per  cent,  per  annum,  nor  more  than  six  per  cent,  per 
annum ;  and  provided  further,  that  the  right  or  privilege  of 
such  option  shall  be  contingent  upon  the  fact  that  all  the  as- 
sets invested  of  such  company  are  invested  within  this  State, 
or  in  bonds  of  the  United  States.  If  any  investment  of  the 
assets  of  any  company  is  in  bonds  of  any  other  State,  or  in 
property  without  this  State,  the  valuation  shall  then  and  in 
such  case  be  based  on  the  above  mentioned  tables  of  mor- 
tality, and  the  rate  of  interest  to  be  assumed  shall  be  four  and 
Acinary.  one  half  per  cent,  per  annum.  For  the  purpose  of  making 
the  valuation  aforesaid,  the  Insurance  Commissioner  of  this 
State  is  authorized  to  employ  a  competent  Actuary,  whose 
compensation  for  such  valuation  shall  be  three  cents  for  each 
thousand  dollars  of  insurance,  to  be  paid  by  the  respective 
companies  for  which  the  valuation  is  made. 

Sec.  2.     Section  two  of  said  Act  is  hereby  amended  so  as 
to  read  as  follows :' 


Insurance 
Commis 


Section  2.  When  the  certificate  of  the  Insurance  Com- 
Soae?"  missioner  of  this  State  of  the  official  valuation  of  the  policies, 
as  provided  in  section  one  of  this  Act,  issued  to  any  company 
organized  under  the  laws  of  this  State,  shall  not  be  accepted 
by  any  other  State  in  lieu  of  a  valuation  of  the  same  by  the 
insurance  officer  of  such  other  State,  then  all  companies  organ- 
ized under  the  laws  of  such  other  State  doing  business  in  this 
State  shall  be  required  to  have  a  separate  valuation  made, 
under  the  authority  of  the  Insurance  Commissioner  of  this 
State,  to  be  based  upon  the  rate  of  mortality  as  established  by 
the  American  Experience  Tables  of  mortality,  and  the  rate 
of  interest  to  be  assumed  shall  be  four  and  one  half  per  cent, 
per  annum. 

Sec.  3.     This  Act  shall  take  effect  immediately. 


business 
without  a 
license. 


LICENSES    IN    SAN   FRANCISCO.  57 

STATUTES    RELATIVE    TO    AND    ORDINANCES 
OF    SAN   FRANCISCO. 

[Approved  March  30,  18*72.] 

Section  1.     If  any  person  or  persons,  whether  as  princi-  Penalty  for 

^    *  x  L  transacting 

pal  or  principals,  agent  or  agents,  clerk  or  clerks,  employe  or 
employes,  or  any  firm  or  member  of  any  corporation,  shall  be 
engaged  in  carrying  on,  pursuing  or  transacting,  within  the 
limits  of  the  city  and  county  of  San  Francisco,  any  business, 
trade  or  profession,  occupation  or  employment,  which  now  is 
or  shall  hereafter  be  by  law  required  to  be  licensed,  without 
having  first  obtained  and  procured  the  license  therefor  so  re- 
quired by  the  laws  of  this  State,  or  by  the  lawful  orders  of  the 
Board  of  Supervisors  of  said  city  and  county,  or  shall,  after 
five  days'  notice  in  writing,  refuse,  neglect,  omit,  or  fail  to 
comply  with  any  requirement  or  requirements,  provision  or  pro- 
visions, of  the  laws  of  this  State  or  orders  of  the  said  Board  of 
Supervisors  requiring  such  person  or  persons,  firm  or  corpora- 
tion, to  procure  a  license,  he,  she,  or  they,  or  either  of  them, 
as  the  case  may  be,  shall  be  deemed  guilty  of  a  misdemeanor, 
and  on  conviction  thereof,  shall  be  punished  by  a  fine  of  not 
less  than  one  hundred  dollars,  or  by  imprisonment  for  a 
period  not  exceeding  thirty  days,  in  case  the  fine  is  not  paid. 

Sec.  2.     The  Collector  of  Licenses,  Chief  Deputy  Col-  Powers  and 

~  7  i       J  duties  of  Li- 

lector  of  Licenses,  and  Assistant  Deputy  Collectors   of  Li-   cense  coiiec- 

censes  of  said  city  and  county,  are  hereby  authorized,  em- 
powered, and  required  to  collect  all  State  and  county  licenses 
provided  for  and  required  by  law  to  be  collected  within  the 
limits  of  said  city  and  county,  in  addition  to  the  municipal 
licenses  now  required  to  be  collected  or  which  shall  hereafter 
be  required  to  be  collected  by  them  or  either  of  them ;  and 
it  shall  be  the  duty  of  said  Collector  of  Licenses,  Deputy 
Collector  of  Licenses,  and  Assistant  Collectors  of  Licenses,  to 
attend  to  the  collection  of  licenses,  and  examine  all  places  of 
business  and  persons  liable  to  pay  licenses,  and  to  see  that 


58  LICENSES   IN   SAN   FRANCISCO. 

licenses  are  taken  out  and  paid  for.  They  shall  each  have 
and  exercise,  in  the  performance  of  their  official  duties,  the 
•  same  powers  as  police  officers  in  serving  process  or  summons 
and  in  making  arrests ;  also,  shall  each  have  and  exercise  the 
power  to  administer  such  oaths  and  affirmations  as  shall  be 
necessary  in  the  discharge  and  exercise  of  their  official  duties ; 
and  they  and  each  of  them  are  hereby  empowered  to  enter 
any  place  of  business  for  which  a  license  by  law  is  provided 
and  required,  free  of  charge,  at  their  pleasure,  and  to  demand 
the  exhibition  of  any  license  for  the  current  time,  from  any 
person,  or  firm,  or  corporation,  engaged  or  employed  in  the 
transaction  of  any  business  for  which  a  license  is  by  law  ren- 
dered necessary  ;  and  if  such  person,  or  firm,  or  corporation, 
or  either  of  them,  shall  be  unable,  or  refuse,  or  neglect,  or 
fail  to  then  and  there  exhibit  such  license,  he,  she,  or  they, 
as  the  case  may  be,  shall  be  deemed  guilty  of  a  misdemeanor, 
and  on  conviction  thereof  shall  be  punished  as  provided  by 
section  one  of  this  Act  for  the  punishment  upon  conviction  of 
a  misdemeanor. 

ordinance*.  Sec.  3.  The  Board  of  Supervisors  of  the  city  and  county 
of  San  Francisco  shall  have  power,  by  ordinance,  to  license 
and  regulate  all  such  callings,  trades,  and  employments  as  the 
public  good  may  require  to  be  licensed  and  regulated,  and  as 
are  not  prohibited  by  law,  and  shall  have  power  to  make  all 
needful  rules  and  regulations  to  govern  the  official  conduct 
and  duties  of  the  Collector  of  Licenses,  Deputy  Collector  of 
Licenses,  and  the  Assistant  Collectors  of  Licenses,  who  shall 
each  hold  office  during  the  pleasure  of  the  power  appointing 
them,  (and  who  shall  pursue  no  other  calling  or  business) 
and  to  alter  and  amend  the  same  from  time  to  time  in  such 
manner  as  they  may  deem  proper  and  for  the  public  good, 
and  to  fix  the  amounts  of  the  bonds  to  be  required  from  the 
Collector  of  Licenses  and  Deputy  Collector  of  Licenses  and 
Assistant  Collectors  of  Licenses.     *     *     *     *      *      *      * 

Sec.  7.     This  Act  shall  take  effect  and  be  in  force  on  and 
after  the  twentieth  day  subsequent  to  its  passage. 


INSURANCE   LICENSES.  59 

ORDINANCE    OF    THE    CITY    AND    COUNTY   OF 
SAN  FRANCISCO. 

ORDER  No.  1048. 


Section  1.     Each  person  or  firm  who  shall  be   engaged  Agent  to  pay 

x  °    °  license  for 

in  the  business  of  insurance,  in  this  city  and  county,  as  agent  J^y  h°emrep- 
or  agents  of  or  for  any  insurance  company,  whether  fire,  reseuts- 
marine,  life,  or   accidental,    are   hereby  divided   into    four 
classes,  and  shall  pay  for  each  and  every  such  company  so 
represented  by  him  or  them  as  agent  or  agents,  a  license  as 
follows : 

First.     Those  doing  business  to  the  amount  of  fifty  thous-   ^$0es*u°£._ 
and  ($50,000)  dollars  and  over  per  quarter  constitute  the  of%o.cense 
First  Class,  and  must  pay  a  license  of  one  hundred  ($100) 
dollars  per  quarter. 

Second.     Those  doing  business  to  the  amount  of  twentv-  Business  of 

°  J       $25,000,  li- 

five  thousand  ($25,000)  dollars,  and  less  than  fifty  thousand  cense  of  $75. 
($50,000)  dollars  per  quarter  constitute  the  Second  Class, 
and  must  pay  a  license  of  seventy-five  ($75)  dollars  per 
quarter. 

Third.     Those  doing  business  to  the  amount  of  ten  thous-  Business  of 
and  ($10,000)  dollars,  and  less  than  twenty-five  thousand  cense  of  $50 
($25,000)  dollars,  per  quarter,  constitute  the  Third  Class, 
and  must  pay  a  license  of  fifty  ($50)  dollars  per  quarter. 

Fourth.     Those  doing  business  in  any  amount  less  than  Business  of 
ten  thousand  ($10,000)  dollars  per   quarter,  constitute  the  SooK- 
Fourth  Class,  and  must  pay  a  license  of  twenty-five  ($25) 
dollars  per  quarter. 

Sec.  2.  Each  person  or  firm  liable  to  procure  a  license 
under  the  preceding  section,  shall,  during  the  last  ten  days  ment.' 
in  the  month  of  June,  1872,  and  during  the  first  ten  days  of 
the  last  month  of  each  quarter  thereafter,  render  at  the  office 
of  the  Collector  of  Licenses  a  sworn  statement  of  the  amount 
of  business  done  during  the  prior  two  months,  and  for  the 
purpose  of  ascertaining    the    rate  of  license,  the  monthly 


Agent  must 
render  state- 


60  INSURANCE   LICENSES. 

average  for  the  prior  two  months,  and  thereafter  for  the  pre- 
ceding first  two  months  of  each  quarter,  shall  constitute  the 
monthly  average  for  the  whole  quarter. 

Not  to  apply       Sec.  3.     This  Order  shall  not  apply  to  sub-agents  of  com- 

to  sub-agents  i  i    J  o 

panies  or  firms  whose  principal  agent  shall  have  complied  with 
these  provisions. 

Duties  of  Sec.  4.     It  shall  be  the  duty  of  the  Auditor  to  procure 

Auditor  and  •>  *■ 

Sector!6  °01"  and  issue  to  the  License  Collector  the  aforesaid  licenses,  and 
it  is  hereby  made  the  duty  of  the  Collector  of  Licenses  and 
Deputy  Collectors  of  Licenses  to  attend  to  the  collection  of 
said  license,  and  the  further  duties  of  said  Auditor  and 
License  Collector  are  hereby  declared  to  be  such  as  are  re- 
quired by  the  provisions  of  Sections  27,  28,  and  29  of  Chap- 
ter VIII  of  Order  No.  697.   . 

penalty  for         Sec.  5.     Any  person  who  shall   carry  on  any  branch  of 

doing  busi-  . 

iicense.ithout  business  as  designated  without  the  license  provided  for  in  this 
Order,  shall  be  deemed  guilty  of  a  misdemeanor,  and,  upon 
conviction  thereof,  shall  be  punished  by  a  fine  of  not  less 
than  five  dollars  nor  more  than  five  hundred  dollars,  or  by 
imprisonment  in  the  County  Jail  not  less  than  two  days  nor 
more  than  six  months. 

License  how       Sec  6.     All  licenses  issued  under  the  provisions  of  this 

designated.  l 

Order  shall  be  designated  and  known  as  "Insurance  Licenses," 
and  all  Orders  or  parts  of  Orders  conflicting  with  any  of  the 
provisions  of  this  Order  are  hereby  repealed. 

Sec.  7.     This  Order  shall  take  effect  and  be  in  force  from 
and  after  July  1,  1872. 

JNO.  A.  RUSSELL,  Clerk. 

Approved,  San  Francisco,  June  18,  1872. 

WILLIAM  ALVORD,  Mayor, 
And  ex-officio  President  Board  of  Supervisors. 


INDEX. 


Page.  Sec. 
ACT— 

takes  effect 51  118 

ACTUARY— 

Commissioner  may  employ 18  447 

"             "          "       31  604 

"       56  1 

compensation  of 18  44V 

"           "   31  604 

" 55  1 

how  paid ./. 18  447 

AGENT— 

appointment  to  be  filed 33  608 

change  of 33  608 

and  attorney — appointment  of 42  616 

" 53  1 

"             penalty  for  failure  to  designate 53  2 

"            privilege  of  corporation  on  compliance.  .. .  53  3 

"            to  file  bond  with  Commissioner 47  623 

"            to  file  separate  bond,  each  company 48  624 

"            to  render  statement  to  collector  of  licenses  59  2 
ARTICLES  OF  INCORPORATION— 

to  be  filed 32  607 

ASSESSMENT— 

Commissioner  to  make  for  deficiency  of  expense  of  office.  31  606 

companies  liable  for , 31  606 

ATTORNEY  GENERAL— 

duties  of,  in  certain  cases 29  601 

BOND— 

foreign  corporation 47  628 

conditions  of 47  623 

agent  must  give  separate  for  each  company 48  624 

Insurance  Commissioner  must  give 49  632 

CERTIFICATE— 

Commissioner  must  issue 24  595 

surrender  of  must  be  published 24  596 


62  INDEX. 

Page.  See. 

CERTIFICATE— 

to  be  revoked  by  Commissioner 28  600 

to  be  filed  with  Commissioner 32  60*7 

"                 "              33  608 

of  Commissioner,  effect  of  its  rejection 19  449 

CODES- 
CIVIL 5 

title  of 5  1 

when  takes  effect 5  2 

not  retroactive,  etc 5  3 

construction  of 5  4 

" 6  5 

effect  on  action  commenced  or  right  accrued  before  taking 

effect 6  6 

effect  on  existing  statutes 6  20 

how  cited 6  21 

construction  of  act 51  117 

Political 21 

title  of  the  act 21  1 

time  of  taking  effect 21  2 

effect  of  upon  statutes 21  18 

how  cited,  etc 21  20 

construction  of,  as  to  laws  passed  at  this  session 52  4478 

how  affected  by  laws  of  present  session 52  4479 

DEPOSITS— 

securities  under  laws  of  other  States 44  618 

Commissioner  to  receipt  for 45  619 

to  be  returned — when — how 45  620 

DEPUTY  INSURANCE  COMMISSIONER— 

who  not  eligible 24  594 

DIRECTORS— 

liability  of  in  cases  cited 29  601 

DISTRICT  COURT— 

duties  of,  in  certain  cases 29  601 

DIVIDENDS— 

directors  must  make 8  417 

of  what  and  when 8  417 

amount  to  be  reserved  first 12  429 

«          "             "         "     12  430 

EXAMINATION— 

by  Commissioner 27  597 

to  be  published  if  deemed  advisable 27  597 

FEES— 

Commissioner  to  require 31  605 

"            "receive 50  633 


INDEX.  63 

Page.  Sec. 
FINES— 

Commissioner  may  collect 27  598 

"            must  collect 44  617 

"                      "             19  450 

"             must  impose  in  certain  cases 46  622 

INSOLVENCY— 

of  insurance  company — what  constitutes  it 30  602 

INSURANCE  COMMISSIONER— 

to  determine  as  to  insurance  corporations  holding  real 

estate 8  415 

must  have  policies  valued 18  447 

"               "             "     55  1 

must  require  duplicate  certificate 11  425 

who  not  eligible 24  594 

general  duties  of 25  595 

to  issue  certificate  of  authority 25  595 

must  publish  surrender  of  certificate 25  595 

must  report  to  the  Governor 25  595 

must  examine  affairs  of  insurers 27  597 

may  administer  oaths 27  597 

may  publish  result  of  examination 27  597 

may  collect  fines,  how 27  598 

must  collect  fines 43  617 

"       '"           "    19  450 

must  impose  fines  in  certain  cases 46  622 

may  issue  subpoenas 28  599 

may  issue  attachments 28  599 

duties  on  insolvency  of  insurer 28  600 

must  revoke  certificate . 28  600 

must  communicate  to  Attorney  General 29  601 

must  not  be  held  liable 29  601 

must  keep  a  record  of  proceedings 31  603 

may  employ  an  actuary 31  604 

must  collect  fees 31  605 

must  pay  over  fees  to  State  Treasurer 32  606 

must  require  certain  certificates 32  607 

may  determine  name  of  company 33  609 

must  furnish  blanks 41  615 

must  collect  penalty 43  617 

must  receive  security,  from  whom 44  618 

must  make  deposit  of  securities 44  618 

must  make  examination  of  securities,  when 45  621 

duties  of,  under  section  622 46  622 

must  furnish  Assessor,  what 48  625 

must  enforce  penalties,  for  what 49  626 

may  procure  rooms,  etc 49  630 


64  INDEX. 

Page.  Sec. 
INSURANCE  COMMISSIONER— 

must  keep  his  office,  where 49  631 

must  execute  official  bond 49  632 

may  issue  certificate  of  valuation 55  1 

effect  of  rejection  of  his  certificate  by  officer  of  another 

State 19  449 

INSURANCE  CORPORATIONS— HOME— 

subscriptions  to  capital  stock 7  414 

purchase,  etc.,  real  estate 8  415 

policies,  how  issued,  etc. 8  416 

dividends,  of  what,  and  when  to  be  declared 8  417 

directors,  liabilities  of 9  418 

capital  stock,  what  amount  to  be 9  419 

capital  stock,  amended  section 9  419 

payment  of  subscription 10  424 

certificate  of  paid  up  capital  to  be  filed 11  425 

may  insure,  what 11  426 

may  invest  funds,  how 11  427 

rate  of  risk  to  capital 11  428 

amount  to  be  reserved  before  making  dividend 12  429 

"                       "                 "                     "        12  430 

penalty  for  refusal  to  give  information 27  598 

capital  stock  to  be  repaired,  when 28  600 

effect  of  not  repairing  stock 29  601 

certificates  of  what,  to  be  filed 32  607 

Commissioner  may  determine  name  of 33  609 

stock  notes,  how  computed 41  614 

statements  to  be  made  by  it 34  610 

"          what  to  exhibit  .. . 34  611 

"              "              " 36  612 

"              "              «        39  618 

penalty  for  failing  to  make  statement,  etc 43  617 

subject  to  fines  and  penalties,  when 49  626 

fire  and  marine  must  state  in  gold 49  627 

INSURANCE  CORPORATION— FOREIGN— 

must  designate  agent 53  1 

"             "            "     and  attorney 42  616 

"     file  certified  power  of  attorney 33  608 

penalty  in  certain  case 53  2 

privilege  in  certain  event 53  3 

must  file  certified  copy  of  charter 32  607 

must  file  certificate  as  to  capital  and  organization 32  607 

statements  to  be  made  by 34  610 

"     "     "   34  611 

'•     "     "   36  612 

"     "     "   39  613 


INDEX.  65 

Page.  Sec. 

INSURANCE  CORPORATION— FOREIGN— 

penalty — not  filing  statement,  etc 43  617 

subject  to  provisions  of  retaliatory  section 46  622 

agent  must  file  bond 47  623 

must  comply  with  provisions  of  Civil  Code. 49  626 

statements  to  be  made  in  gold  coin 49  627 

Mutual  Life,  Etc. — Home — 

capital  stock 13  437 

guarantee  fund 13  437 

guarantee  fund,  of  what  to  consist 13  438 

fixed  capital,  what  constitutes  it  14  439 

declaration  of  fixed  capital 14  440 

guarantee  notes  and  interest,  how  disposed  of 15  441 

insured,  to  be  entitled  to  vote 16  442 

directors,  number  of 16  443 

investments,  in  what  to  be  made ,. .  16  444 

limitation  as  to  holding  stock 18  445 

premiums,  how  payable 18  446 

must  furnish  Commissioner  with  certain  data 18  447 

no  stamp  required 19  448 

INVESTMENTS— 

funds  of  fire  and  marine  companies 11  427 

"       life  insurance  companies 16  444 

LICENSES— 

Commissioner  to  issue 50  633 

auditor  to  issue 60  4 

how  classified .' 59  1 

who  to  collect 60  4 

penalty  in  relation  to 60  6 

how  designated 60  6 

NAME  OF  CORPORATION— 

to  be  submitted  to  Commissioner 33  609 

NON-FORFEITURE  ACT 54  1 

ORDINANCE  OF  SAN  FRANCISCO— 

imposes  license  tax : 59  1 

agent  must  make  statement 59  2 

not  applicable  to  sub-agents 60  3 

when  takes  effect 60  7 

PENALTIES— 

policy,  failing  to  show,  issued  in  this  State 19  450 

doing  business  without  Commissioner's  certificate 26  596 

refusing  information , 27  598 

failure  to  deposit  certain  statements,  etc 43  617 

fraudulently  assuming  to  be  an  agent 50  633 

doing  business  without  license 60  5 


66  INDEX. 

Page.  Sec. 
POLICIES  OF  LIFE  INSURANCE— 

what  they  must  contain 19  450 

must  be  paid  and  cancelled,  when 20  451 

PREMIUMS— 

of  insurance,  how  payable 18  446 

RECORD— 

Insurance  Commissioner  must  keep 31  603 

RENEWALS— 

company  may  collect 26  596 

RETALIATORY   LAW 19  449 

"                     "      47  622 

REPEALED  RIGHTS  MAINTAINED 50  116 

REPORT  OF  COMMISSIONER— 

must  be  made,  when,  and  to  whom 25  595 

must  be  printed  and  distributed,  how 22  337 

SALARY— 

of  Commissioner 49  628 

of  Deputy  Commissioner 49  629 

SECURITIES— 

to  be  examined 45  621 

when  deposit  of  required 44  618 

SOLICITORS— 

to  be  licensed 50  633 

STATUTES— 

how  construed 5  4 

effect  of  Civil  Code  on 6  5 

"            "         "          6  20 

repealed  by  Code 21  18 

STATEMENTS— 

to  be  made  by  insurance  companies 34  610 

annual,  when  and  how  to  be  filed 34  611 

what  to  exhibit .  35  611 

when  to  be  made 35  611 

fire  and  marine,  what  to  show — pages 36  612 

life,  health,  and  accident,  what  to  show — pages 39  613 

STATE  TREASURER— 

must  receive  deposits  of  securities 44  618 

and  deliver  them,  how  and  when 44  618 

STOCK  NOTES— 

how  treated 41  614 

VALUATION  OF  POLICIES— 

Commissioner  must  make 18  447 

"                     "          55  1 

how  to  be  made 18  447 

"       "        «     5£  i 

companies  to  furnish  data 18  447 


*     3 


06i-s 


